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Russia to Help Resolve North Korean Financial Crisis


The United States and Russia are reported to have arranged for banks to resolve a financial dispute over frozen North Korean funds. The issue has been a major sticking point holding up Pyongyang's movement on a nuclear disarmament agreement it signed on to in February. VOA's Stephanie Ho reports from Washington.

North Korea has refused to move forward on its pledge to shut down its nuclear reactor until it receives $25 million in funds that were frozen in 2005 in a Macau bank. Washington alleges the money was tied to money laundering and counterfeiting.

The money has been freed for release, but North Korea has not withdrawn it directly, insisting instead that the funds be transferred through an intermediary bank.

On Sunday, South Korea's Yonhap News Agency reported that Russia has accepted a U.S. request that a Russian bank accept the North Korean funds via a U.S. financial institution, before the money is moved to North Korea.

South Korean Foreign Ministry spokesman Cho Hee-yong said there are close consultations to resolve the financial dispute, but he did not comment specifically on the Yonhap report.

Chief U.S. representative to the six-party talks on the North Korean nuclear issue, Christopher Hill, acknowledged that U.S. and Russian officials have been discussing the issue.

"We have tried to be helpful in this process, and I think other members of the six-party process are trying to be helpful, namely the Russians," said Christopher Hill.

The countries in the six-party talks include the United States, North Korea, China, South Korea, Japan and Russia.

Hill spoke in an interview conducted Wednesday and broadcast Sunday by the public affairs cable television channel C-Span. He said he expects after North Korea gets its money, Pyongyang will move forward on its promise to shut down its plutonium-based nuclear facility, in exchange for up to one-million tons of heavy fuel oil.

"We know they have got something on the order of 50 kilos of plutonium, some 110 pounds of it," he said. "Depending on how big a weapon is, you can make maybe eight, 10, weapons out of this plutonium."

Hill said the United States also wants to know more about North Korea's efforts to pursue highly enriched uranium, another material used in nuclear weapons. He said U.S. officials know that Pyongyang bought the centrifuges necessary to enrich uranium, but wants to find out if the North Koreans know how to use them correctly.

"And if it turns out they [North Korea] were successful in reverse-engineering some 12 to 20 centrifuges that we know they bought from the A.Q. Khan network and were able to make a few hundred or a few thousand and put them together in a cascade to produce highly-enriched uranium, well, then, they have got to stop this," said Hill.

Hill is set to meet in Washington this week with South Korea's main nuclear negotiator, Chun Yung-woo.

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