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I would like to discuss implications of the February 13, 2007 Six Party nuclear agreement with the DPRK and prospects for future progress to address the North Korea nuclear issue.  The February Agreement represents a dramatic change in U.S. policy.  When the Agreed Framework collapsed in 2003 – following the discovery that North Korea was pursing a secret enrichment program - the Bush Administration demanded complete, verifiable, and irreversible nuclear disarmament before North Korea would receive substantial economic and political benefits from the United States.  This was called the Libya model.  To reinforce these demands, Washington targeted financial sanctions against Pyongyang, forcing Banco Delta Asia (BDA) in Macau to freeze $25 million in North Korean funds, including money from illicit drug trafficking and counterfeiting activities.  Some U.S. officials hoped that these sanctions would undermine Kim Jong Il’s rule, therefore removing the North Korean nuclear threat through regime change.

Rather than capitulate or collapse, however, Pyongyang retaliated.  North Korea boycotted the Six Party Talks and then escalated the standoff by conducting multiple missile tests in July 2006 and a nuclear test in October 2006.  Although the U.S. was able to win support for limited United Nation Security Council sanctions against the DPRK, which pressured North Korea to return to the bargaining table, Washington faced the risk of a major crisis in Northeast Asia, if Pyongyang carried out its threats to conduct additional nuclear tests.  At the same time, Washington’s energy and attention has been focused on dealing with critical problems in the Middle East, including efforts to win the war in Iraq, stop Iran from developing a nuclear weapons capability, and restart the Israeli-Palestinian peace process.  Therefore, to avert a new crisis in Asia, Washington decided to drop its demand for complete disarmament and accept a more modest nuclear agreement with Pyongyang, which would help stabilize the situation and limit North Korea’s nuclear weapons capability.

The February 13, 2007 Six Party Agreement is a useful initial step.  In the first phase of the agreement, North Korea is required to shut down and seal its plutonium production facilities at the Yongbyon nuclear center within 60 days under IAEA monitoring, in exchange for 50,000 tons of heavy fuel oil provided by the Republic of Korea.  As an added incentive, the U.S. agreed to allow the return to North Korea of the frozen $25 million BDA funds, which Pyongyang promised to use for ‘humanitarian’ purposes.  In essence, this initial phase of the February 2007 agreement restores the freeze on plutonium production that was established under the Agreed Framework from 1994 to 2003.  Unfortunately, this new freeze comes too late to stop North Korea from acquiring enough additional plutonium for six to eight nuclear weapons in the period from 2003 to 2006, in addition to the one or two bomb’s worth of plutonium that North Korea is suspected of acquiring before 1994.  Overall, this means that North Korea probably has enough plutonium for a small nuclear arsenal, most likely less than ten weapons.

Currently, implementation of the first phase is jeopardized by ‘technical delays’ in returning the BDA frozen funds to North Korea.  Nonetheless, it appears likely that these difficulties will be resolved, and North Korea will shut down its Yongbyon facilities under IAEA supervision, even if the shutdown is somewhat delayed beyond the 60 days required under the February agreement.  The second phase of the agreement, however, will be much more difficult to achieve.   In this phase, North Korea is required to provide a ‘complete declaration of all nuclear programs’ (presumably including the secret enrichment program) and accept ‘disablement of all existing nuclear facilities’ in exchange for economic, energy, and humanitarian assistance equal to one millions tons of heavy fuel oil, including the initial 50,000 ton oil shipment.  In addition to negotiation of these denuclearization steps, the February agreement also establishes working groups to simultaneously deal with political issues, such as normalizing political relations between the U.S. and DPRK and between the DPRK and Japan.

Many difficult problems confront implementation of the second phase.  First, any declaration North Korea makes about its nuclear program will be extremely difficult to verify without very intrusive measures, which Pyongyang is likely to resist.  For example, even if Pyongyang admits a small research and development enrichment program, it would be necessary to interview scientists, inspect sites, review documents, and take environmental samples to conclude that the declaration is full and accurate.  Second, North Korea continues to insist that compensation for additional disarmament steps should come in the form of the light water reactor nuclear power project, which the U.S, rejects.  Third, the negotiators will need to define the meaning of ‘disablement’.  Naturally, Pyongyang will seek technical measures that could be easily reversed if necessary, while Washington and its allies will seek steps that would render the nuclear facilities unusable in the future.

Aside from these narrow nuclear issues, there are broader political issues of linkage and timing.  North Korea wants the U.S. to lift sanctions and remove the DPRK from the terrorism list as it takes additional disarmament steps, while Japan wants the U.S. to delay normalization of relations with North Korea until progress is made on resolving the abduction issue, which shows little sign of movement.  Moreover, Pyongyang may decide to postpone agreement on any additional nuclear steps until the next U.S. administration takes office, if the North Koreans calculate that they can get a better deal from the new U.S. President.  For example, the North Koreans may think that if the next U.S. President is a Democrat, the U.S. might be willing to resume support for the Light Water Reactor project, which was originally offered under a Democratic Administration.

This does not mean that progress is impossible during the remainder of President Bush’s term of office.  The North Koreans might be willing to take some additional disarmament steps if the price is right, for example if the U.S. offers to establish diplomatic relations, lift economic sanctions, and resume the Light Water Reactor project.  However, achieving a dramatic improvement in U.S.-DPRK relations is not likely to be a high priority for the rest of President Bush’s term in office.  Finally, and most important, the rulers in Pyongyang believe that retaining a nuclear deterrent is essential to defend their country from external pressures and threats.  While they may accept limits and constraints on their nuclear weapons capability in exchange for generous compensation, North Korea’s leaders are very unlikely to give up their nuclear hedge completely.

For all of these reasons, the February 2007 agreement will not lead to a nuclear-free Korean peninsula anytime in the near future.  Nonetheless, the agreement helps to limit North Korea’s nuclear capabilities and creates a framework for negotiating additional denuclearization and political measures.  Because President Bush has started this process, it will be easier for the next U.S. President – whether Democratic or Republican – to continue the effort.  Although actual nuclear disarmament is probably not feasible for the time being, it may be possible to negotiate an agreement that calls for eventual disarmament in the long term once certain conditions have been established, such as a peace treaty ending the Korean War.  In the meantime, such an agreement will help the U.S. and its allies South Korea and Japan to contain and manage the threat posed by a nuclear-armed North Korean.