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UNCLAS SECTION 01 OF 05 SEOUL 001495 
 
SIPDIS 
 
E.O. 12958: N/A 
TAGS: PREL PGOV MARR ECON KPAO KS US
SUBJECT: SEOUL - PRESS BULLETIN; September 18, 2009 
 
TOP HEADLINES 
------------- 
 
 
Chosun Ilbo, Segye Ilbo, All TVs 
2 Trillion Won in Microcredit Planned for Low-income Households 
 
JoongAng Ilbo 
11 Members of "Honor Society" Have "DNA for Donation" 
 
Dong-a Ilbo 
67 Government-funded Projects See Costs Triple 
 
Hankook Ilbo, Seoul Shinmun 
Finance Minister, Central Bank Governor Clash over Central Bank 
Reform 
 
Hankyoreh Shinmun 
1.5 Trillion Won of Taxpayers' Money Spent to Make Up for Losses 
from Privately-funded Construction Projects 
 
 
DOMESTIC DEVELOPMENTS 
--------------------- 
 
Seoul and Washington are working out a new strategy toward North 
Korea in order not to repeat their past failures in negotiations 
with North Korea and to end the North's cycle of provocations, 
conciliatory gestures and stalling for time to win concessions. 
(Chosun) 
 
INTERNATIONAL NEWS 
------------------ 
 
According to North Korea's Korean Central News Agency, Dai Bingguo, 
special envoy of Chinese President Hu Jintao, met in Pyongyang 
yesterday with the North's First Vice Foreign Minister Kang Sok-ju, 
and they had a "candid and in-depth exchange of views" on bilateral, 
regional and international issues. (Chosun, Dong-a, Hankook, 
Hankyoreh, Segye, Seoul, all TVs) 
 
The U.S. Congressional Research Service, in its latest report, said 
that Washington may be able to provide six major economic incentives 
to North Korea in return for its denuclearization: normalize 
bilateral ties, lift sanctions, sign a trade treaty, allow the North 
to join international financial institutions, provide energy and 
food aid, and offer preferential tariffs on goods produced at the 
Kaesong Industrial Complex. (JoongAng, Dong-a, Hankook, Hankyoreh, 
Segye, Seoul) 
 
Japan's new Foreign Minister Katsuya Okada told a press conference 
yesterday that Japan will not negotiate with North Korea unless the 
North takes action to resolve the issue of abductees. (Chosun) 
 
MEDIA ANALYSIS 
-------------- 
 
-N. Korea 
---------- 
 
Conservative Chosun Ilbo ran an inside-page report entitled "Only 
'Sticks,' Not 'Carrots,' Until N. Korea Dismantles Its Nuclear 
Program."   It said that Seoul and Washington are working out a new 
strategy toward North Korea in order not to repeat their past 
failures in negotiations with North Korea and to end the North's 
cycle of provocations, conciliatory gestures and stalling for time 
to win concessions. 
 
As support for this report, Chosun quoted Foreign Minister Yu 
Myung-hwan as telling lawmakers yesterday that even if talks with 
North Korea resume the U.S. will continue to implement UN Security 
Council sanctions against North Korea, unless the North takes 
tangible steps toward denuclearization.  Another senior ROKG 
 
SEOUL 00001495  002 OF 005 
 
 
official was also quoted: "There will be no compensation until North 
Korea takes action to denuclearize." 
 
Chosun editorialized: "The U.S. is saying that it will pursue 
bilateral talks with North Korea within the context of the Six-Party 
Talks.  This means sharing the economic burden in providing 
incentives to North Korea.  The time is approaching for Seoul to 
exercise high-level negotiating skills, given that the ROK has been 
almost solely responsible for such incentives while being ignored by 
the North." 
 
Most ROK media gave attention to the U.S. Congressional Research 
Service (CRS)'s latest report, in which the CRS said that Washington 
may be able to provide six major economic incentives to North Korea 
in return for its denuclearization: normalize bilateral ties, lift 
sanctions, sign a trade treaty, allow the North to join 
international financial institutions, provide energy and food aid 
and preferential tariffs on goods produced at the Kaesong Industrial 
Complex. 
 
Most media also gave coverage to yesterday's meeting in Pyongyang 
between Dai Bingguo, special envoy of Chinese President Hu Jintao, 
and North Korea's First Vice Foreign Minister Kang Sok-ju. 
 
Conservative Chosun Ilbo observed that the Chinese State Councilor 
is in Pyongyang to prepare the schedule and agenda for Chinese 
Premier Wen Jiabao's visit to the country slated for Oct. 4-6 but 
that there is speculation that the North's nuclear program is also 
under discussion, given that the delegation also includes Chinese 
Chief Nuclear Negotiator Wu Dawei. 
 
Conservative Dong-a Ilbo commented that it appears that China, by 
sending a high-level envoy to North Korea, intends to maintain its 
leadership role in the Six Party negotiations on denuclearizing the 
Korean Peninsula. 
 
Left-leaning Hankyoreh Shinmun headlined its story: "China Scrambles 
to Mediate Behind the Scenes... It Seems to Have Persuaded N. Korea 
to Return to Six-Party Talks" 
 
 
- President Obama's Missile Defense Decision 
------------------------------------------- 
 
Most ROK media gave attention to President Barack Obama's decision 
to scrap plans for a U.S. missile defense system in the Czech 
Republic and Poland. 
 
Newspapers carried the following headlines: "U.S. Shelves Eastern 
Europe Missile Defense Program; Russia Welcomes It but Conservative 
Circles, the Czech Republic and Poland Protest" (conservative Chosun 
Ilbo); "Obama Seeks Improved Relations with Russia by Reversing a 
Bush Administration Policy" (right-of-center JoongAng Ilbo); and 
"U.S. Gives Up Eastern Europe MD Citing Reduced Iranian Missile 
Threats... Change Expected in U.S. Global Defense Strategy" 
(left-leaning Hankyoreh Shinmun.) 
 
Opinions/Editorials 
------------------- 
 
¶N. Korea Should Not Get Anything Until It Denuclearizes 
(Chosun Ilbo, September 18, 2009, Page 39) 
 
U.S. Secretary of State Hillary Clinton on Tuesday said she intends 
to explain to North Korea the incentives it can expect if it agrees 
to dismantle its nuclear program, as well as the consequences if it 
does not.  In a recent report, the U.S. Congressional Research 
Service named as possible incentives the normalization of diplomatic 
relations, the lifting of sanctions, and energy and food aid.  CRS 
said the World Bank or the Asian Development Bank could set up a 
special fund to support North Korea's economic transformation. 
 
In previous negotiations with North Korea over nuclear 
dismantlement, the U.S. made written promises, including a pledge to 
 
SEOUL 00001495  003 OF 005 
 
 
respect the sovereignty of the regime, and offered incentives such 
as food aid and the construction of a light water reactor.  Despite 
all that, North Korea conducted a second nuclear test in May and 
recently told the UN Security Council that it has reached the "final 
stage" of enriching uranium for weapons purposes. 
 
These mistakes must not be repeated.  The U.S. must not fall into 
North Korea's trap of slicing its nuclear dismantlement process into 
many different phases, demanding incentives for each stage.  In past 
negotiations, North Korea lived up to only the first and second 
stages of its pledge by freezing and disabling the reactor in 
Yongbyon, and was lavishly rewarded each time. But it put up one 
excuse after another when it came to actually dismantling its 
nuclear program and later restarted the Yongbyon reactor.  From now 
on, it must be given incentives only when it irreversibly dismantles 
its nuclear facilities. 
 
The U.S. is saying that it will pursue bilateral talks with North 
Korea within the context of the Six-Party Talks.  This means sharing 
the economic burden in providing incentives to North Korea.  The 
time is approaching for Seoul to exercise high-level negotiating 
skills, given that the ROK has been almost solely responsible for 
such incentives while being ignored by the North. 
 
(This is a translation provided by the newspaper, and it is 
identical to the Korean version.) 
 
FEATURES 
--------- 
 
Only "Sticks," Not "Carrots," Until N. Korea Dismantles Its Nuclear 
Program 
(Chosun Ilbo, September 18, 2009, Page 6) 
 
By Reporter Ahn Yong-hyun 
 
Seoul and Washington are working out a new strategy toward North 
Korea in order not to repeat their past failures in the over 15-year 
negotiations with North Korea and to end the North's cycle of 
provocations, conciliatory gestures and stalling for time to win 
concessions. 
 
The two allies are apparently determined to maintain sanctions 
against the North until it denuclearizes.  They believe their 
mistake in the past has been to use a piecemeal approach to 
negotiations that immediately rewarded the North for every small, 
reversible step. 
 
Foreign Minister Yu Myung-hwan told the National Assembly's Foreign 
Affairs, Trade and Unification Committee on Thursday, "Even if talks 
with North Korea resume, the U.S. will continue to implement UN 
Security Council sanctions against North Korea, unless the North 
takes tangible steps toward denuclearization." 
 
"This government too will maintain the existing policy of faithfully 
implementing sanctions against the North until it takes verifiable 
steps to end its nuclear program.  At the same time, we'll keep the 
dialogue door open to persuade the North to return to the Six-Party 
Talks," he added. 
 
A senior government official said, "There will be no compensation 
until North Korea takes action to denuclearize."  In other words, if 
North Korea abandons its nuclear ambitions, it will be provided with 
massive aid, but the aid will come only after the "irreversible 
dismantlement of North Korea's nuclear programs."  The official 
stressed that there will be no rewards for a "reversible behavior" 
or a simple "promise" to abandon nuclear programs. 
 
All the signs are that Seoul and Washington are determined not to 
fall again for the North's cycle of provocations, conciliatory 
gestures and stalling for time to win concessions.  As a senior 
government official has suggested, the ROK and the U.S. need "basic 
changes to the larger framework in their approach to the North 
Korean nuclear issue." 
 
SEOUL 00001495  004 OF 005 
 
 
 
North Korea has often avoided sanctions by agreeing to dialogue, 
slicing the denuclearization process into smaller stages, from 
"shutdown," via "disablement" to "dismantlement," and pulling out 
before the process is complete. 
 
The senior ROKG official noted, "The 'comprehensive package' that 
President Lee Myung-bak proposed to U.S. President Obama this past 
June also came in the context of a fundamental change being needed 
in an approach toward North Korea.  However, the ROKG is concerned 
that the term may be confused with the "package deal" from the 
previous Kim Dae-jung Administration, thereby giving an impression 
that North Korea is presented with a "bundle of gifts."  Therefore, 
the ROKG is considering using different terms, such as an 
"irreversible deal." 
 
In the September 19, 2005 Joint Statement, North Korea promised to 
disable all its existing nuclear facilities in return for energy aid 
equivalent to 1 million tons of heavy fuel oil.  While adhering to 
the "action-for-action" principle, North Korea earned rewards 
whenever it switched off the outdated nuclear facilities at Yongbyon 
one by one.  So far, the North has been provided with energy aid 
equivalent to 750,000 tons of heavy fuel aid.  In June, 2008, after 
blowing up a cooling tower at Yongbyon, the nation was removed from 
the State Department's list of states that sponsor terrorism. 
However, while engaging in belligerent moves this year, Pyongyang 
retracted all its disablement steps at one stroke.  The (North) 
Korean Central News Agency reported on September 4, "Reprocessing of 
spent fuel rods is at its final phase and extracted plutonium is 
being weaponized."  An ROKG foreign policy official said, "Does it 
make sense to have negotiations under which our provision of heavy 
fuel oil is irreversible but North Korea's nuclear disablement steps 
are reversible at any time?" 
 
A Blue House official said, "We won't engage in talks that might 
result in stage-by-stage agreements like the statement of principles 
in the fourth round of the Six-Party Talks in Sept. 19, 2005, or 
talks that might lead to an agreement on disablement that is 
reversible like the Feb. 13, 2007 deal." 
 
Prof. Kim Sung-han of Korea University said Seoul and Washington 
would "conduct talks to launch a North Korean version of  the 
Marshall Plan," the large-scale economic aid program for postwar 
Europe, "as well as security guarantees if the North goes directly 
to the stage of verifiable dismantlement and completely removes its 
nuclear weapons, nuclear materials and nuclear facilities 
overseas." 
 
In addition, Japan's Asahi Shimbun carried a noteworthy report 
quoting Six-Party Talks sources as saying that the ROK and U.S. 
governments are reviewing a plan to officially recognize the current 
North Korean regime led by Kim Jong-il in return for the North's 
nuclear dismantlement.  The newspaper also reported that there is a 
possibility that the ROK and the U.S. governments may propose to 
replace the current armistice agreement with a peace treaty and 
provide massive economic assistance to Pyongyang. 
 
The Congressional Research Service (CRS) has recently released a 
report on "North Korea: Economic Leverage and Policy Analysis," 
which spells out six incentives the U.S. could provide to the North. 
 The incentives include normalizing diplomatic ties, signing a trade 
treaty, lifting sanctions, allowing the North to join international 
financial institutions, providing energy and food aid and giving 
preferential treatment to goods produced at the Kaesong Industrial 
Complex.  U.S. Secretary of State Hillary Clinton said on September 
15 that when U.S.-North Korea bilateral talks take place, the U.S. 
will explain to North Korea the incentives it can get if it pursues 
denuclearization and the consequences if it doesn't. 
 
[This is a translation provided by the newspaper.  We have compared 
the English version on the website with the Korean version and added 
some paragraphs to make them identical.] 
 
 
 
SEOUL 00001495  005 OF 005 
 
 
TOKOLA