FACE-SAVING COMPROMISE?
An analyst in Seoul said Kim's comments might indicate Pyongyang was fishing
for a compromise, where the United States could say not all of the North's
accounts frozen at the Macau bank were used for illicit activity and then free
up some funds.
"Seoul's preference is for the U.S. to find some gesture that will help North
Korea save face. China's position is not all that different," said Kim Sung-han,
head of North American studies at the Institute of Foreign Affairs and National
Security.
Analysts have said a meeting between the U.S. and Chinese presidents next
week in the United States could also increase the pressure on North Korea to
return to talks.
Beijing is urging flexibility on the financial crackdown. Tokyo says
Pyongyang must appreciate that unless the atomic issue and a separate standoff
with Japan over abductees is resolved the North's already weak economic position
would deteriorate further.
Hill, currently in South Korea, said Pyongyang was boycotting the
discussions, but urged patience for the stalled process.
Washington says the financial issue is separate from the nuclear talks and
has urged Pyongyang to return to the talks.
Hill said the amount of the frozen Macau funds was about $20 million, equal
to approximately one week's worth of energy aid proposed by South Korea for the
North in return for scrapping its nuclear programs.
"The DPRK needs to understand that as long as it is going to be producing
nuclear weapons, we are going to be having a real close look at its finances,"
Hill said, referring to the North's official name, the Democratic People's
Republic of Korea.
Hill, who was in Tokyo until Wednesday, had no substantive discussions with
Kim in the Japanese capital, dimming prospects for renewed progress in the
nuclear talks. Hill said he was ready to meet Kim face-to-face within the
six-party format.
The last round of the talks among the two Koreas, China, Japan, Russia and
the United States was held in November.