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The U.S.-brokered plan to export two power reactors to the Democratic People's Republic of Korea (DPRK) in return for termination of the DPRK's clandestine nuclear program was set back last week when the firm expected to supply the reactors suddenly withdrew its export license request, filed in December with the U.S. Nuclear Regulatory Commission (NRC). In parallel, senior U.S. government officials began indicating that the Clinton Administration may raise its stake in the reactor transfer project to keep it on track. U.S. officials are also now considering recasting the deal in light of economic, political, and legal difficulties it faces. Asea Brown Boveri-Combustion Engineering (ABB-CE) holds the rights to technology for the reactors which the U.S., Japan, the Republic of Korea (ROK), and the Korea Peninsula Energy Development Organization (KEDO) had agreed to supply to the DPRK in time to begin operating in about 2003. While key reactor components were to be made by South Korean industry, this would happen under license from the U.S. technology holder, and would require a U.S. export permit. Accordingly, last December, ABB-CE applied under U.S. law with NRC to get a license for exporting the reactors. But following an interagency review of that application, and after the Nonproliferation Policy Education Center, a non-profit group in Washington, D.C., had told NRC and the U.S. Department of State it would seek a formal hearing on the license request, ABB-CE then suddenly withdrew its application, stating only that it had been ''premature.'' Experts and nonproliferation policy advocates who are critical of the DPRK reactor project now vow they will form a political coalition, including powerful legislators in the U.S. Congress, to try and force the Clinton Administration to rethink the deal. In particular, they said, opponents want to terminate the reactor transfer and supply the DPRK only non-nuclear equipment and technology instead. They elaborated that, unless the U.S. signs and then ratifies a bilateral nuclear cooperation agreement with the DPRK, ABB-CE cannot provide any reactors to North Korea. U.S. officials responsible for licensing the export told Nucleonics Week last week that this interpretation of events was correct. These sources said that unless the DPRK fully satisfies the IAEA that all its nuclear materials are accounted for and under safeguards, the U.S. cannot agree to nuclear cooperation with the DPRK under the 1978 U.S. Nuclear Nonproliferation Act. Currently, the IAEA is not satisfied with the nonproliferation credentials of the DPRK, and no progress has been made in determining how much weapons-usable plutonium the DPRK has secretly produced and is holding outside of international inspections. According to licensing documents submitted by ABB-CE, however, for the KEDO project to go forward on schedule, the first reactor components must be shipped to the DPRK in 1999. In addition to the restrictions imposed on near-term transfer of equipment to the DPRK under U.S. law, by the anticipated delivery date for components, one financial analyst at Merrill-Lynch's office in Seoul said last week, the battered Korean economy ''will still be in a pretty deep recession.'' While U.S. officials continue to reiterate general assertions that the ROK will uphold its commitments to the KEDO project, internal documents on talks between the U.S. and South Korea held in January, provided to Nucleonics Week, state categorically that the ROK intends to provide far less money to the project than both the U.S. and Japan have previously asserted. At the same time, U.S. officials appear to be wavering in their resolve not to increase funding for the reactors. While senior officials at the National Security Council and the U.S. State Department in mid-January held the line on demands by South Korea to contribute more, last week U.S. Deputy Secretary of State for East Asia Stanley Roth said that the U.S. is now considering upping its contribution to the project to about $500-million, and urged the U.S. Congress to support a pending request for funds. [Ed. Note: On February 24 the State Department denied that Roth made such a statement. See the March 2 edition of Nuclear Watch for details.] The Congress is presently not focused on the difficulties of Clinton's Korean policy. But some Congressional staffers last week said that legislators critical of the reactor deal might call for a public hearing on the issue, should the U.S. officially change its mind and press for a greater financial commitment. Nuclear Watch is written exclusively for Global Beat by Mark Hibbs, the European Editor of Nucleonics Week and Nuclear Fuel, leading specialist newsletters on international nuclear affairs, published by McGraw-Hill, Inc. Hibbs, based in Bonn, Germany, covers nuclear energy and proliferation problems in Europe, the former Soviet Union, and Asia. Mark Hibbs' coordinates: Return to Global Beat Home Page Nuclear Watch | East Asian Security | Economic & Monetary Union | NATO Expansion | Nuclear Weapons and Proliferation | U.S. Defense Policy | Publications | Events | |
