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UNCLAS SECTION 01 OF 07 SEOUL 001591 
 
SIPDIS 
 
E.O. 12958: N/A 
TAGS: PREL PGOV MARR ECON KPAO KS US
SUBJECT: SEOUL - PRESS BULLETIN; October 7, 2009 
 
TOP HEADLINES 
------------- 
 
 
Chosun Ilbo 
NGOs Allegedly Embezzled Hundreds of Millions of Won 
in Government Subsidies 
 
JoongAng Ilbo 
Korea Development Bank May Withdraw Loans 
from GM Daewoo 
 
Dong-a Ilbo 
ROK, Japan Mull Daylight Saving Time for Next Year 
 
Hankook Ilbo 
Prosecutors Did Not Investigate Hyosung Group Even after Being 
Tipped Off about Its Illegal Activities 
 
Hankyoreh Shinmun 
Blue House Pressures Three Telecom Service Operators for KRW 25 
Billion in Donations 
 
Segye Ilbo, Seoul Shinmun, All TVs 
Kim Jong-il Signals "Conditional Return to Six-Party Talks" 
 
 
DOMESTIC DEVELOPMENTS 
--------------------- 
 
Foreign Minister Yu Myung-hwan, in an Oct. 6 seminar with the media, 
said that the latest North Korea-China economic cooperation deals 
may be in violation of the UN Security Council resolutions imposed 
on North Korea, adding: "We have expressed our interest in these 
matters and expect China to explain itself." (Dong-a) 
 
According to an ROKG source, the four North Korean containers seized 
in Busan last month for allegedly carrying items related to chemical 
weapons were headed for Syria. (Dong-a) 
 
 
INTERNATIONAL NEWS 
------------------ 
 
According to North Korea's official Korean Central News Agency, 
North Korean leader Kim Jong-il told visiting Chinese Premier Wen 
Jiabao on Oct. 5 that North Korea is "willing to participate in 
multilateral talks, including the Six-Party Talks, depending on the 
outcome of its talks with the U.S." (All) 
 
According to an ROKG source, ROK and U.S. intelligence authorities 
think that there is a high possibility that North Korea this month 
may complete restoring its Yongbyon nuclear facilities (disabled 
under previous accords) and resume reprocessing spent fuel rods. 
(Dong-a, Hankook, Segye, Seoul) 
 
 
 
MEDIA ANALYSIS 
--------------- 
 
-N. Korea 
--------- 
All media gave prominent play to North Korean leader Kim Jong-il's 
hint at the possibility of a conditional return to the Six-Party 
Talks during Oct. 5 talks with visiting Chinese Premier Wen Jiabao. 
The North Korean leader was widely quoted as saying: "Depending on 
the outcome of its talks with the U.S, North Korea is willing to 
participate in multilateral talks, including the Six-Party Talks." 
 
State Department Spokesman Ian Kelly was also widely quoted in 
statements he made about the Six-Party process, calling it "the best 
mechanism for achieving denuclearization" on the Korean Peninsula. 
 
SEOUL 00001591  002 OF 007 
 
 
 
 
Conservative Dong-a Ilbo quoted a Blue House official as saying: 
"The North's hint at its possible return to the Six-Party Talks is 
positive, but we cannot say that the situation has changed since 
Pyongyang has suggested bilateral talks with Washington as a 
precondition."  Dong-a also noted Foreign Minister Yu Myung-hwan's 
remarks during a seminar yesterday, in which he said that the latest 
North Korea-China economic cooperation deals may be in violation of 
the UN Security Council resolutions imposed on North Korea, adding: 
"We have expressed our interest in these matters and expect China to 
explain itself." 
 
Most media described Kim's mention of the Six-Party Talks as 
"progress," but observed that the focus of Kim's latest remarks 
appears to be on bilateral talks with the U.S., rather than the 
Six-Party Talks.  In particular, conservative Chosun Ilbo commented 
that Kim's remarks are only "lip service" to China and constitute a 
de facto refusal by the North to participate in the Six-Party Talks 
and a clear expression that the North will instead concentrate on 
bilateral talks with the U.S.   Chosun went on to report that 
Chinese officials are apparently taken aback by the North Korean 
leader's statement because they see little it that signals progress 
over his expressed willingness to engage in "bilateral and 
multilateral talks," which was conveyed to Chinese State Councilor 
Dai Bingguo when he visited Pyongyang on Sept. 18. 
 
Newspapers carried the following headlines: "Conditional Return to 
Six-Party Talks... Kim Jong-il Remains Unchanged" (conservative 
Chosun Ilbo); "Kim Jong-il Pockets $20 Million in Aid from China in 
Return for Conditional Return to Six-Party Talks" (right-of-center 
JoongAng Ilbo); N. Korea Sets 'Traps of Conditions' to Return to 
Six-Party Talks" (conservative Dong-a Ilbo); and "China Saves Face, 
while N. Korea Wins Practical Benefits" (conservative Segye Ilbo) 
 
Conservative Chosun Ilbo editorialized: "North Korean leader Kim 
Jong-il's statement, 'That North Korea is ready to hold multilateral 
talks and these talks include the Six-Party Talks suggests that they 
may, depending on circumstances, push for trilateral talks between 
the U.S., North Korea and China, instead of the Six-Party Talks. 
After all, Chinese Premier Wen's visit to Pyongyang resulted in 
massive economic aid to North Korea in return for the North's mere 
"expression of willingness" to return to multilateral talks, instead 
of its clear promise to return to the Six-Party Talks.." 
 
Right-of-center JoongAng Ilbo's editorial argued: "... North Korean 
leader Kim Jong-il's position reveals his belief that discussion on 
the nuclear issue should be between the U.S. and North Korea, and 
that the Six-Party Talks will confirm (whatever outcome results from 
those talks).  However, the U.S. believes that any discussions about 
the resolution of the nuclear issue must be within the framework of 
the Six-Party Talks and that U.S.-North Korea dialogue should serve 
as a stepping stone for the multilateral talks.  A visit to 
Pyongyang by U.S. Special Representative for North Korea Policy 
Stephen Bosworth is (more) likely to happen if this difference in 
position is narrowed to some degree." 
 
Conservative Dong-a Ilbo editorialized: "It is highly likely that 
the North mentioned the Six-Party Talks as a face-saving measure for 
China.  China's (economic) assistance may also violate U.N. Security 
Council Resolution 1874 sanctioning North Korea. ...  If Beijing 
promised assistance banned by the U.N. to maintain its influence 
over Pyongyang, it does not deserve a seat at the U.N. Security 
Council.  Rather, this could further encourage North Korea to 
develop nuclear weapons, judging that international sanctions 
against it might no longer be as strict as they used to be." 
 
Moderate Hankook Ilbo editorialized: "The ball is now in other 
Six-Party countries' court. ... The U.S. is likely to take cautious 
steps to make sure that North Korea will return to the Six-Party 
Talks while the international community continues to cooperate to 
enforce sanctions against North Korea.  The U.S., however, should 
not miss this rare opportunity by moving too slowly." 
 
 
SEOUL 00001591  003 OF 007 
 
 
 
OPINIONS/EDITORIALS 
-------------------- 
 
NO POINT IN SIX-PARTY TALKS IF THEY ONLY CONFIRM WHAT IS DISCUSSED 
IN U.S.-NORTH KOREA BILATERAL TALKS 
(JoongAng Ilbo, October 7, 2009, Page 42) 
 
During North Korean leader Kim Jong Il's meeting with Chinese 
Premier Wen Jiabao on October 5, Kim reportedly expressed that, 
depending on the outcome of talks with the U.S., the North would be 
willing to conditionally rejoin the Six-Party Talks.  This is a step 
forward from his previous position that "the Six-Party Talks are 
gone forever."  The statement also appears to be a face-saving 
measure for China, which (evidently) promised the North massive 
economic aid.  Whatever the reason, (Kim Jong Il's hint at rejoining 
the Six-Party Talks) is a welcome advance in his position.  However, 
since the Six-Party Talks are not expected to resume soon, and the 
North did not (explicitly) promise to denuclearize, we cannot see 
this as a reversal of the current situation.  This is why the ROK, 
the U.S., and Japan are reacting cautiously while China welcomes the 
result of the Kim-Wen meeting, going so far as to say that it has 
helped them to reach an "important consensus" and bring about 
"active progress" in the pursuit of denuclearization of the Korean 
Peninsula. 
 
(The North's) statement may (still) facilitate U.S.-North Korea 
dialogue, however, despite there being a wide difference between the 
North and the U.S. over the perception of the nature of the 
bilateral talks.  Kim's position reveals his belief that discussion 
on the nuclear issue should be between the U.S. and North Korea, and 
that the Six-Party Talks will confirm (whatever outcome results from 
those talks).  However, the U.S. believes that any discussions about 
the resolution of the nuclear issue must be within the framework of 
the Six-Party Talks and that U.S.-North Korea dialogue should serve 
as a stepping stone for the multilateral talks.  A visit to 
Pyongyang by U.S. Special Representative for North Korea Policy 
Stephen Bosworth is (more) likely to happen if this difference in 
position is narrowed to some degree. 
 
Right after the outcome of the Kim-Wen meeting was disclosed, the 
U.S. Department of State released a statement concluding that the 
five parties (excluding the North) had agreed that "the Six-Party 
process (would serve as) the best mechanism (for resolving the 
nuclear issue)."  The State Department also stressed that the five 
parties had reached a consensus on the complete enforcement of the 
resolution of UN Security Council sanctions.  We believe that the 
USG should continue to maintain this stance.  Looking back to how 
the North Korean nuclear issue has unfolded over the past two 
decades, we think that there is no alternative (to the Six-Party 
Talks).  The reason for this is that, even though Kim Jong-il has 
maintained that the denuclearization of the Korean Peninsula was the 
dying wish of (his father,) North Korea's founder Kim Il-sung, the 
younger Kim's actions have not matched his words.  We cannot simply 
believe what he says and expect the nuclear issue to be resolved. 
The two-track approach of "pressure and dialogue" should be 
maintained until there is an assurance that North Korea abandons its 
nuclear (ambitions.). 
 
President Lee Myung-bak will attend the ROK-U.S. summit on October 9 
and the ROK-China-Japan summits on October 10.  During these 
summits, he should not only figure out North Korea's true intentions 
but also clearly state the ROK's position.  He should try to calm 
controversy over the "grand bargain" proposal and ensure that the 
five parties adhere to the agreements that "the nuclear issue should 
be resolved within the Six-Party framework" and "the UNSC sanctions 
should be maintained unless the North shows any change in its 
attitude."  In particular, the ROK should closely coordinate its 
(North Korean) policy with the U.S., which will have bilateral 
dialogue with the North, and China, which maintains a special 
relationship with the North. 
 
 
CHINA'S FAILURE TO DO MORE 
 
SEOUL 00001591  004 OF 007 
 
 
(Dong-a Ilbo, October 7, 2009, page 35) 
 
China has failed to persuade North Korea to return to the Six-Party 
Talks in the near future.  North Korean leader Kim Jong-Il told 
visiting Chinese Premier Wen Jiabao in Pyongyang Monday, "We are 
willing to go ahead with multilateral dialogue including the 
Six-Party Talks after looking at the outcome of bilateral talks with 
the U.S."  Kim added, "Our relationship with the U.S. must turn 
peaceful through bilateral talks."  By mentioning the Six-Party 
Talks, Kim apparently meant Pyongyang would return to them only if 
the North gets its way with Washington first.  If China is content 
with his comment, it does not deserve to be the host of the 
Six-Party Talks. 
 
Beijing is said to have promised substantial economic assistance to 
Pyongyang on the occasion of Wen's visit.  His delegation signed 
several agreements, including an "exchange document on economic 
assistance."  China will provide an estimated KRW 170 billion (USD 
145 million) for the construction of a bridge over the Yalu River. 
It is highly likely that the North mentioned the Six-Party Talks as 
a face-saving measure for China. 
 
China's (economic) assistance may also violate U.N. Security Council 
Resolution 1874 sanctioning North Korea.  The resolution requires 
all member states and international financial and credit 
institutions not to enter into new commitments of grants, financial 
assistance, or concessional loans with the North, except for 
humanitarian and developmental purposes that directly address the 
needs of the civilian population or denuclearization.  If Beijing 
promised assistance banned by the U.N. to maintain its influence 
over Pyongyang, it does not deserve a seat at the U.N. Security 
Council.  Rather, this could further encourage North Korea to 
develop nuclear weapons, judging that international sanctions 
against it might no longer be as strict as they used to be. 
 
China must clearly realize why North Korea insists on bilateral 
talks with the U.S. North Korea has long argued that the two 
countries must discuss nuclear disarmament in tandem with the 
signing of a peace treaty and withdrawal of U.S. forces from the 
ROK.  If this argument is accepted, this means that Pyongyang is 
recognized as a nuclear power.  Even if the Six-Party Talks are 
resumed, they will end up on the sidelines of North Korea-U.S. 
dialogue. 
 
The international community must not be duped by North Korea's 
tactics.  U.S. Secretary of State Hillary Clinton said of the North 
Korea-China talks that the five parties of the ROK, the U.S., Japan, 
China and Russia have all agreed that the Six-Party Talks are the 
best way to resolve North Korea's nuclear program.  This is a 
relief.  The ROK's Foreign Minister Yu Myung-hwan also said 
yesterday, "North Korea's nuclear issue must be discussed in the 
Six-Party Talks."  The ROK, China and Japan held a trilateral summit 
in Beijing Saturday.  The leaders of these three countries can and 
should advance coordination efforts for the denuclearization of 
North Korea. 
 
(This is a translation provided by the newspaper, and it is 
identical to the Korean version.) 
 
 
CHINA WEAKENS IMPACT OF PRESSURE ON N. KOREA 
(Chosun Ilbo, October 7, 2009, page 35) 
 
North Korean leader Kim Jong-il told visiting Chinese Premier Wen 
Jiabao on Monday that his country is willing to attend multilateral 
talks, including the Six-Party Talks, depending on the progress in 
its talks with the United States.  It was a shift from the vow never 
to return to the Six-Party Talks which the North made in protest 
against UN sanctions following its second nuclear test. 
 
But Kim's comments contain strategic pitfalls and ambiguities that 
are trademarks of the Stalinist country's diplomatic style. 
 
A prime example is the caveat that the North's return to Six-Party 
 
SEOUL 00001591  005 OF 007 
 
 
Talks depends on progress in bilateral talks with Washington, which 
seems to imply it wants rewards first.  But the U.S. government 
wants to avoid promising rewards or discussing the specifics of 
North Korea's nuclear program during the meeting.  That would make 
it difficult for North Korea to walk away with rewards, and the 
Six-Party Talks could once again be postponed indefinitely.  That 
North Korea is ready to hold multilateral talks and these talks 
include the Six-Party Talks suggests that they may, depending on 
circumstances, push for trilateral talks between the U.S., North 
Korea and China, instead of the Six-Party Talks. 
 
After all, Chinese Premier Wen's visit to Pyongyang resulted in 
massive economic aid to North Korea in return for the North's mere 
"expression of willingness" to return to multilateral talks, instead 
of its clear promise to return to the Six-Party Talks.  In doing so, 
it is repeating the mistake of the past of rewarding North Korea 
before it has done anything, especially when UN sanctions are still 
in effect.  This approach weakens international pressure on North 
Korea and the negotiating powers of the countries in the Six-Party 
Talks. 
 
Kim repeated that denuclearization on the Korean Peninsula was the 
"last wish" of former leader Kim Il-sung and that Pyongyang would 
continue to achieve that wish.  But North Korea has used that line 
in the past, only to shift back to supporting its nuclear weapons 
program citing "hostile" policies by the ROK and the U.S.  Even if 
talks resume, this attitude shows that Pyongyang can quit again at 
any time, to say nothing of the trouble it can make during talks. 
 
In bilateral talks between North Korea and the U.S., Washington 
could give Pyongyang a hint of the contents of the "comprehensive 
package" the allies are promising, but specific details should be 
left for the Six-Party Talks. U.S.-North Korea talks must be kept as 
brief as possible. 
 
(This is a translation provided by the newspaper, and it is 
identical to the Korean version.) 
 
 
LEE ADMINISTRATION MUST CHANGE NOW-OBSOLETE N. KOREA POLICY 
(Hankyoreh Shinmun, October 7, 2009, page 31) 
 
An important situational change in the North Korea nuclear issue has 
taken place over the past two days during the high-level meeting 
between North Korea and China. Meeting with Chinese Prime Minister 
Wen Jiabao two days ago, Kim Jong-il, Commissioner of North Korea's 
National Defense Commission said North Korea is prepared to accede 
to multilateral talks, including the Six-Party Talks, because there 
has been progress in discussions about holding bilateral North 
Korea-U.S. talks.. 
 
The return to Six-Party Talks is conditioned on the results of 
bilateral North Korea-U.S. talks, but Kim's direct reference to the 
Six-Party Talks, which North Korean authorities had declared dead on 
several occasions, seems to be a signal that North Korea will return 
to the path of dialogue.  The statement also indicates that the 
situation on the Korean Peninsula might move from sanctions that 
began with last spring's North Korean satellite launch and nuclear 
test towards dialogue. 
 
Of course, even if dialogue begins, there are many mountains to 
cross.  First, there is a high probability that North Korea will 
continue its push for bilateral talks, stressing that the starting 
point of the North Korean nuclear issue is U.S. hostile policy 
towards North Korea.  Moreover, even if North Korea agrees to 
multilateral talks, a tug-of-war will ensue between the relevant 
countries over whether the talks should be six-party, three-party 
(North Korea, U.S., China) or four-party (the ROK, North Korea, 
China, U.S.).  It is also unclear whether results from North 
Korea-U.S. bilateral talks will draw North Korea back as a 
participant in multilateral talks.  Despite these uncertain factors, 
it is fortunate that tensions on the Korean Peninsula have settled 
and the door for dialogue has opened. 
 
 
SEOUL 00001591  006 OF 007 
 
 
The significance of this meeting between China and North Korea for 
the international community, including the ROK, is twofold, broadly 
speaking.  First, with China agreeing to large-scale economic aid to 
North Korea, sanctions against North Korea have been rendered 
virtually powerless.  With China, which accounted for over 70 
percent of North Korean trade last year, pledging large-scale 
economic cooperation, pressuring North Korea through sanctions is 
nothing more than a joke. 
 
The other point of significance is that the two nations have pledged 
to strengthen their friendship "for generations to come."  This 
means China will support the North Korean regime in the long-term. 
One could say a honeymoon era between North Korea and China has 
begun.  The Lee Myung-bak Administration is greatly at fault for 
letting the situation reach this point, because (the Administration) 
thoroughly blocked exchanges and cooperation with North Korea. 
 
Having secured Chinese political and economic support, North Korea's 
will become more insistent in its demands with the ROK and the U.S.. 
 Our government, however, says it will stick to pressuring North 
Korea through international cooperation, the limit of which was 
clearly displayed here.  It is not too late.  It is time for the Lee 
Administration to craft a new North Korea policy in line with the 
new changes. 
 
(This is a translation provided by the newspaper, and it is 
identical to the Korean version.) 
 
 
¶N. KOREA THROWS BALL FOR SIX-PARTY TALKS INTO OTHER COUNTRIES' COURT 
 
(Hankook Ilbo, October 7, 2009, page 39) 
 
North Korean leader Kim Jong-il expressed a conditional willingness 
to return to the Six-Party Talks.  During talks with Chinese Premier 
Wen Jiabao, Kim said, "North Korea is willing to participate in 
multilateral talks, including the Six-Party Talks, depending on the 
outcome of its talks with the U.S."  This seems to be a considerable 
jump in progress from last month's meeting between Kim Jong-il and 
Chinese State Councilor Dai Bingguo, who was visiting Pyongyang as a 
Chinese presidential envoy.  (During the meeting,) Kim said that the 
North would be willing to participate in bilateral and multilateral 
talks, but did not (specifically) mention the Six-Party Talks. 
There is even a probability that, depending on the outcome of 
U.S.-North Korea bilateral talks, discussions on the North Korean 
nuclear issue may progress more rapidly following the resumption of 
the Six-Party Talks. (According to sources,) U.S. Special 
Representative for North Korea Policy Stephen Bosworth is expected 
to visit North Korea late this month. 
 
Still, Kim Jong-il's intentions are dubious because he attached 
conditions (to a return to the Six-Party Talks.)  This has led to 
suspicion that while his statement may have been a face-saving 
measure for China, the North intends to bide its time while avoiding 
international sanctions and pressure.  It would be difficult for 
North Korea, which declared the Six-Party Talks dead (months ago), 
to issue a sudden announcement that it will return to the Six-Party 
Talks.  Therefore it seems that Pyongyang needed time to find a 
justification (for its return to the Six-Party Talks.)  Some 
analysts believe that North Korea and China must have made 
behind-the-scenes deals considering Chinese state media's report 
that there was significant progress on the North Korean nuclear 
issue during the Kim-Wen meeting. 
 
The ball is now in other Six-Party countries' court.  Attention is 
turning to what next move the Obama Administration, which has 
expressed its interest in holding bilateral talks with the North, 
will make.  The U.S. is likely to take cautious steps to make sure 
that North Korea will return to the Six-Party Talks while the 
international community continues to cooperate to enforce sanctions 
against North Korea.  The U.S., however, should not miss this rare 
opportunity by moving too slowly.  Other Six-Party countries such as 
Japan should undertake more efforts to put the Six-Party Talks back 
on track.  North Korea stuck to the expression of "multilateral 
 
SEOUL 00001591  007 OF 007 
 
 
talks" apparently to warn of the possibility of engaging in 
three-party or four-party talks excluding Japan. 
 
The ROKG also should step up efforts (to resume the Six-Party 
Talks.)  Our wait-and-see approach may leave us sidelined amid signs 
of a drastic change in developments (surrounding the Korean 
Peninsula.)  The ROKG needs to take a more active approach to make 
President Lee's "grand bargain" proposal a practical and tangible 
concept since it has been criticized for being somewhat far-fetched. 
 
 
 
STEPHENS