Order Code IB91141
CRS Issue Brief for Congress
Received through the CRS Web
North Korea’s Nuclear Weapons Program
Updated February 27, 2001
Larry A. Niksch
Foreign Affairs, Defense, and Trade Division
Congressional Research Service ˜ The Library of Congress

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CONTENTS
SUMMARY
MOST RECENT DEVELOPMENTS
BACKGROUND AND ANALYSIS
North Korea’s Nuclear Program
Disclosure of the Kumchangri Underground Complex
International Assistance
North Korea’s Delivery Systems
State of Nuclear Weapons Development
Diplomatic Background to the Agreed Framework and Amending Agreements
The Agreed Framework: Provisions, Implementation, Costs, Future Issues
U.S. Objectives: Primacy to the Freeze of North Korea’s Nuclear Program
Benefits to North Korea
Total U.S. Cost Projections
Light Water Nuclear Reactors
Oil at No Cost
Diplomatic Representation
Lifting the U.S. Economic Embargo
North Korean Obligations Beyond the Freeze of the Nuclear Program
Inspections
Dismantlement of Nuclear Installations
The Perry Initiative, October 1999
Role of Congress

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North Korea’s Nuclear Weapons Program
SUMMARY
North Korea’s nuclear weapons program
light water nuclear reactors totaling 2,000
became an immediate foreign policy issue
electric megawatts by the year 2003;
facing the United States because of North
shipments of “heavy oil” to North Korea
Korea’s refusal to carry out its obligations
(50,000 tons in 1995 and 500,000 tons
under the Nuclear Non-Proliferation Treaty
annually beginning in 1996 until the first light
(NPT) and other nuclear accords it had signed.
water reactor is built).
North Korea has constructed nuclear reactors
and a plutonium reprocessing plant at a site
Dismantlement of North Korea’s current
called Yongbyon. U.S. and other foreign
nuclear facilities and a resolution of the
intelligence assessments have concluded that
International Atomic Energy Agency (IAEA)
North Korea probably has acquired enough
demand for a special inspection of suspected
weapons-grade plutonium for the manufacture
nuclear waste sites are postponed for at least
of at least one nuclear weapon.
five years by the Agreed Framework. The
same is true of North Korean consent to the
The Clinton Administration attempted to
removal of reactor fuel rods, which North
arrange “comprehensive negotiations” with
Korea removed from its operating reactor in
North Korea over the issue and other issues
May 1994.
between North Korea and the United States;
but North Korea’s violations of its obligations
The United States has faced several
under the NPT aborted such talks until August
policy problems since the signing of the
1994.
Agreed Framework, including securing ap-
proximately $60 million annually to finance
The United States and North Korea
heavy oil shipments to North Korea, evidence
signed an agreement on October 21, 1994, that
of clandestine North Korean nuclear activities,
offers North Korea a package of benefits in
and North Korea’s development of long range
return for a freeze of North Korea’s nuclear
missiles.
program. Benefits to North Korea include:
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MOST RECENT DEVELOPMENTS
Recent high-level U.S.-North Korea negotiations, including Secretary of State
Albright’s visit to North Korea in October 2000, apparently made no progress in resolving
the issue of verification that North Korea does not have secret nuclear weapons facilities.
The journal Nucleonics Week reported in its October 19, 2000 issue that the Clinton
Administration considered a proposal to amend the 1994 U.S.-North Korean Agreed
Framework that would have eliminated one of the two light water nuclear reactors which the
United States is obligated to provide North Korea; a conventional electric power plan would
be substituted. The report (substantiated by subsequent reports from other sources) stated
that the Administration had discussed the prospective proposal with Japan and South Korea.
One reason cited for the Administration’s new position is that the estimated cost of the heavy
oil the United States is obligated to provide North Korea under the Agreed Framework has
risen to an estimated $100-120 million in 2001.
BACKGROUND AND ANALYSIS
North Korea’s Nuclear Program
From the U.S. standpoint, a key purpose of the U.S.-North Korean Agreed Framework
of October 21, 1994 is to address the North Korean nuclear program, especially the potential
of that program to produce nuclear weapons. North Korea has several nuclear facilities which
have the potential to produce nuclear weapons. Most are located at Yongbyon, 60 miles of
the North Korean capital of Pyongyang. The key installations are:
! An atomic reactor, with a capacity of about 5 electrical megawatts,
constructed between 1980 and 1987: it reportedly is capable of expending
enough uranium fuel to produce about 7 kilograms of plutonium annually —
enough for the manufacture of a single atomic bomb annually. North Korea
in 1989 shut down the reactor for about 70 days; U.S. intelligence agencies
believe that North Korea removed fuel rods from the reactor at that time for
reprocessing into plutonium suitable for nuclear weapons. In May 1994,
North Korea shut down the reactor and removed about 8,000 fuel rods,
which could be reprocessed into enough plutonium for 4-5 nuclear weapons.
! two larger (estimated 50 electrical megawatts and 200 electrical
megawatts) atomic reactors under construction since 1984: According
to U.S. Ambassador Robert Gallucci, these plants, if completed, would be
capable of producing enough spent fuel annually for 200 kilograms of
plutonium, sufficient to manufacture nearly 30 atomic bombs per year.
! a plutonium reprocessing building about 600 feet long and several
stories high: Hans Blix, head of the International Atomic Energy Agency
(IAEA), said after his visit to North Korea in May 1992 that the facility fit
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the definition of a plutonium reprocessing plant where weapons grade
Plutonium- 239 is separated from a reactor’s spent fuel. North Korea
completed one reprocessing line in 1993. IAEA inspectors in March 1994
saw evidence that North Korea was constructing a second reprocessing
system in the building, which would double plutonium production capacity.
Satellite photographs reportedly also show that the atomic reactors have no attached
power lines, which they would have if used for electric power generation. Hans Blix and a
number of U.S. and South Korean experts have speculated that North Korea might have built
a hidden “pilot” plutonium reprocessing laboratory as a prototype for the large reprocessing
installation.
Persons interviewed for this study believe that North Korea developed the two reactors
and the apparent reprocessing plant with its own resources and technology. It is believed that
Kim Chong-il, the son and successor of President Kim Il-sung who died in July 1994, directs
the program, and that the military and the Ministry of Public Security (North Korea’s version
of the KGB) implement it. North Korea reportedly has about 3,000 scientists and research
personnel devoted to the Yongbyon program. Many have studied nuclear technology (though
not necessarily nuclear weapons production) in the Soviet Union and China and reportedly
Pakistan. The training of nuclear scientists at North Korean universities reportedly is intense.
North Korea has uranium deposits, estimated at 26 million tons. North Korea is believed to
have one uranium producing mine.
Disclosure of the Kumchangri Underground Complex
U.S. intelligence agencies reportedly became aware of the Kumchangri underground
facility in the second half of 1996. The Defense Intelligence Agency (DIA) reportedly
prepared a classified report at the end of 1997, which concluded that the facility, located
about 25 miles north of Yongbyon, “possibly could be a nuclear weapons-related facility by
2003.” The report stated that: “The function of this site has not been determined, but it could
be intended as a nuclear production and/or storage site.” The DIA began to brief staff
members of key congressional committees concerning the Kumchangri site in the spring of
1998. According to staffers privy to the briefing, the DIA over several months provided
detailed information indicating that North Korea was constructing a nuclear installation. In
August 1998, the New York Times and the Washington Post revealed the intelligence findings.
Press reports also indicated that U.S. intelligence agencies are monitoring at least ten more
North Korean installations of a suspicious nature. The Clinton Administration responded to
the disclosure by pressuring North Korea to allow the United States access to the Kumchangri
facility. An agreement was reached on March 16, 1999, providing for multiple inspections
of the site in return for at least 500,000 tons of new U.S. food aid for North Korea. The first
visit took place in May 1999. Administration officials declared that no evidence of nuclear
activity was found. However, previous reports indicated that North Korea had removed
equipment from the facility.
International Assistance
Knowledgeable individuals believe that the Soviet Union did not assist directly in the
development of Yongbyon in the 1980s. The U.S.S.R. provided North Korea with a small
research reactor in the 1960s, which also is at Yongbyon. However, North Korean nuclear
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scientists continued to receive training in the U.S.S.R. up to the demise of the Soviet Union
in December 1991. East German and Russian nuclear and missile scientists reportedly are
in North Korea. Russian military officials confirmed the presence of Russian nuclear and
missile scientists inside North Korea in January 1994. In 1999 and early 2000, reports
appeared that U.S. intelligence agencies had information that China was supplying important
components and raw materials for North Korea’s missile program.
North Korea’s Delivery Systems
North Korea is developing missiles believed capable of delivering nuclear warheads. In
June and July 1998, Secretary of Defense Cohen and other U.S. military officials disclosed
that North Korea had succeeded in developing a “Nodong” missile with a range estimated at
600 miles, capable of covering South Korea and part of Japan. North began deploying
Nodong missiles in late 1998. Since March 1994, U.S. intelligence agencies have reported
that North Korea was developing two longer range Taepo Dong ballistic missiles whose
range likely would include, in the first stage, all of Japan including Okinawa and, in the second
stage, U.S. territories in the Western Pacific and possibly Alaska and Hawaii. On August 31,
1998, North Korea test fired a three stage rocket, apparently the prototype of the Taepo
Dong-1; the third stage apparently was an attempt to launch a satellite. U.S. intelligence
estimates reportedly concluded that such a missile would have the range to reach Alaska,
Guam, and the Northern Marianas Commonwealth. Reports in early 2000 cited U.S.
intelligence findings that, without further flight tests, North Korea could deploy an
intercontinental ballistic missile that would be capable of striking Alaska, Hawaii, and the
U.S. west coast.
These projections led the Clinton Administration to press North Korea for a new round
of talks over North Korea’s missile program. In talks held in March 1999 and July 2000,
North Korea demanded $1 billion annually in exchange for a promise not to export missiles.
North Korea said to U.S. negotiators that it would not negotiate on its missile
development/deployment program, apparently contradicting the offer reported by Russian
President Vladimir Putin in July 2000. U.S. negotiators reportedly rejected North Korea’s
demand for $1 billion but offered a lifting of U.S. economic sanctions against North Korea
in exchange for an agreement on missiles. This laid the ground for the Berlin agreement of
September 1999 in which North Korea agreed to defer further missile tests in return for the
lifting of major U.S. economic sanctions.
State of Nuclear Weapons Development
U.S. and foreign intelligence agencies and experts have concluded a high range of
likelihood that North Korea has acquired enough plutonium and has developed significant
technology to produce a small number of nuclear weapons. North Korea’s approximately 70
day shutdown of the five megawatt reactor in 1989 gave it the opportunity to remove nuclear
fuel rods, from which plutonium is reprocessed. State Department officials estimate that
North Korea may have acquired six to eight kilograms of plutonium from the five megawatt
reactor at Yongbyon, enough, they say, for possibly one bomb. However, the U.S. Central
Intelligence Agency and the Defense Intelligence Agency reportedly estimated in late 1993
that North Korea extracted enough fuel rods for about 12 kilograms of plutonium —
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sufficient for one or two atomic bombs. The CIA and DIA apparently base their estimate on
the 1989 shutdown of the five megawatt reactor. David Albright of the Institute for Science
and International Security produced in 1994 a detailed study of the 1989 reactor shutdown
and concluded that if North Korea removed all of the fuel rods from the reactor during the
shutdown, the rods would have contained 14 kilograms of plutonium.
South Korean and Japanese intelligence estimates reportedly are higher: 16-24 kilograms
(Japan) and 7-22 kilograms (South Korea). These estimates reportedly are based on the view
that North Korea could have acquired a higher volume of plutonium from the 1989 reactor
shutdown and the view of a higher possibility that North Korea removed fuel rods during the
1990 and 1991 reactor slowdowns. Russian Defense Ministry analyses of late 1993
reportedly came to a similar estimate of about 20 kilograms of plutonium, enough for 2 or 3
atomic bombs. Some individual U.S. Government experts believe that under optimum
conditions, North Korea could have produced close to 20 kilograms of plutonium since 1989.
There also is emerging a body of analysis suggesting that North Korea could produce
more nuclear weapons from a given amount of plutonium than standard intelligence estimates
have believed. State Department and U.S. intelligence estimates of the plutonium/bomb
production ratio are close to the IAEA standard that a non-nuclear state would need about
eight kilograms of plutonium to produce a nuclear bomb. However, IAEA spokesman, David
Kyd, stated in August 1994 that Agency officials have known for some time that the eight
kilogram standard was too high. He said that the IAEA retained it because of the wishes of
member governments.
Kyd was reacting to a report of the National Resources Defense Council. Using North
Korea as a standard non-nuclear state, the report concluded that a non-nuclear state with
“low technology” could produce a one kiloton bomb (a small atomic bomb but “with the
potential to kill tens of thousands of people”) with three kilograms of plutonium. A
non-nuclear state with “medium technology” could produce a one kiloton bomb with 1.5
kilograms of plutonium.
Before the National Resources Defense Council released the report, the U.S. Department
of Energy in January 1994 lowered its mean estimate of plutonium required for a small atomic
bomb from eight to four kilograms. Secretary of Defense Perry suggested in July 1994 that,
with a higher level of technology that believed, North Korea could produce more nuclear
weapons with a given amount of plutonium: “If they had a very advanced technology, they
could make five bombs out of the amount of plutonium we estimate they have.”
Russian and U.S. intelligence agencies also reportedly have learned of significant
technological advances by North Korea towards nuclear weapons production. On March 10,
1992, the Russian newspaper Argumenty I Fakty (Arguments and Facts) published the text
of a 1990 Soviet KGB report to the Soviet Central Committee on North Korea’s nuclear
program. It was published again by Izvestiya of June 24, 1994. The KGB report asserted
that “According to available data, development of the first nuclear device has been completed
at the DPRK nuclear research center in Yongbyon.” The North Korean Government, the
report stated, had decided not to test the device in order to avoid international detection. In
July and December 1993 respectively, the journal Nucleonics (July 8) and NBC News
reported that North Korea had converted reprocessed plutonium from a liquid form to pure
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metal, apparently prior to 1993. Nuclear experts describe this action as the last step prior to
the final assembly of an atomic bomb.
Additionally, there are a number of reports and evidence that point to at least a middle
range likelihood that North Korea may have smuggled plutonium from Russia. In June 1994,
the head of Russia’s Counterintelligence Service (successor to the KGB) said at a press
conference that North Korea’s attempts to smuggle “components of nuclear arms production”
from Russia caused his agency “special anxiety.” In August 1994, members of Germany’s
parliament and Chancellor Kohl’s intelligence coordinator stated that they had been briefed
that a German citizen arrested in May 1994 with a small amount of plutonium, smuggled from
Russia, had connections with North Korea. U.S. executive branch officials have expressed
concern in background briefings over the possibility that North Korea has smuggled
plutonium from Russia. One U.S. official, quoted in the Washington Times, July 5, 1994,
asserted that “There is the possibility that things having gotten over the [Russia-North Korea]
border without anybody being aware of it.” The most specific claim came in the German
news magazine Stern in March 1993, which cited Russian Counterintelligence Service reports
that North Korea had smuggled 56 kilograms of plutonium (enough for 7-9 atomic bombs)
from Russia.
Other evidence, albeit circumstantial, includes numerous reports in 1994 of poor security
at Russian nuclear facilities; a warning in June 1994 by the Director of the FBI that Russian
criminal organizations “may already have the capability to steal nuclear weapons, nuclear
weapons components or weapons- grade material”; the close connections that North Korean
intelligence and military organs have had with the former KGB and elements of the
Soviet/Russian military; the network of agents North Korea is known to have inside Russia;
and the publicized North Korean attempts — some apparently successful according to
Russian military officials — to recruit Soviet/Russian nuclear experts, including missile
experts capable of designing nuclear warheads. The Japanese newspaper, SANKEI
SHIMBUN, reported on June 9, 1996, that Kim Chong-u, a leading North Korean economic
official, asserted in a meeting with State Department officials on April 26, 1996, that South
Korea and Japan would have to deal with four North Korean missiles with nuclear warheads
if they didn’t provide North Korea with food.
In March 2000, President Clinton notified Congress that he could not certify that North
Korea was not acquiring enriched uranium for the production of nuclear weapons. The
Japanese newspaper, Sankei Shimbun, reported on June 9, 2000, the contents of a “detailed
report” from Chinese government sources on a secret North Korean uranium enrichment
facility inside North Korea’s Mount Chonma.
Diplomatic Background to the Agreed Framework and
Amending Agreements
In 1991, the Bush Administration took several actions aimed at securing from North
Korea adherence to Pyongyang’s obligations as a signatory of the Nuclear Non-Proliferation
Treaty (NPT); North Korea had signed the treaty in 1985. Bush Administration actions
included the withdraw of U.S. nuclear weapons from South Korea in late 1991. North Korea
entered into two agreements, which specified nuclear obligations. In a denuclearization
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agreement signed in December 1991, North Korea and South Korea pledged not to possess
nuclear weapons, not to possess plutonium reprocessing or uranium enrichment facilities, and
to negotiate a mutual nuclear inspection system. In January 1992, North Korea signed a
safeguards agreement with the International Atomic Energy Agency (IAEA), providing for
regular IAEA inspections of nuclear facilities. In 1992, North Korea rebuffed South Korea
regarding implementation of the denuclearization agreement, but it did allow the IAEA to
conduct six inspections during June 1992-February 1993.
In late 1992, the IAEA found evidence that North Korea had reprocessed more
plutonium than the 80 grams it had disclosed to the Agency. In February 1993, the IAEA
invoked a provision in the safeguards agreement and called for a “special inspection” of two
concealed but apparent nuclear waste sites at Yongbyon. The IAEA believed that a special
inspection would uncover information on the amount of plutonium which North Korea had
produced since 1989. North Korea rejected the IAEA request and announced on March 12,
1993, an intention to withdraw from the NPT.
The NPT withdrawal threat led to low and higher level diplomatic talks between North
Korea and the Clinton Administration. North Korea “suspended” its withdrawal from the
NPT when the Clinton Administration agreed to a high-level meeting in June 1993. However,
North Korea continued to refuse both special inspections and IAEA regular inspections of
facilities designated under the safeguards agreement. In May 1994, North Korea refused to
allow the IAEA to inspect the 8,000 fuel rods, which it had removed from the five megawatt
reactor. In June 1994, North Korea’s President Kim Il-sung reactivated a longstanding
invitation to former U.S. President Jimmy Carter to visit Pyongyang. Kim offered Carter a
freeze of North Korea’s nuclear facilities and operations. Kim took this initiative after China
reportedly informed him that it would not veto a first round of economic sanctions, which the
Clinton Administration had proposed to members of the U.N. Security Council.
The Clinton Administration reacted to Kim’s proposal by dropping its sanctions proposal
and entering into a new round of high-level negotiations with North. This negotiation led to
the Agreed Framework of October 21, 1994. Two amending agreements were concluded in
1995: a U.S.-North Korean statements in Kuala Lumpur, Malaysia in June and a supply
contract for the provision of nuclear reactors to North Korea, concluded in December.
The Agreed Framework: Provisions, Implementation,
Costs, Future Issues
U.S. Objectives: Primacy to the Freeze of North Korea’s Nuclear
Program
The heart of the Agreed Framework and the amending accords is a deal under which the
United States will provide North Korea with a package of nuclear, energy, economic, and
diplomatic benefits; in return North Korea will halt the operations and infrastructure
development of its nuclear program. The Agreed Framework commits North Korea to
“freeze its graphite-moderated reactors and related facilities” within one month of October
21 with the freeze to be monitored by the IAEA. Ambassador Robert Gallucci, who
negotiated for the United States, stated that “related facilities” include the plutonium
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reprocessing plant. According to Gallucci, the freeze includes a halt to construction of the
50 and 200 megawatt reactors and a North Korean promise not to refuel the five megawatt
reactor. The Agreed Framework also commits North Korea to “cooperate” with the United
States in finding a way to store the fuel rods removed from the five megawatt reactor in May
1994 “in a safe manner that does not involve reprocessing in the DPRK [North Korea].”
Administration officials reportedly have said that a secret “confidential minute” to the Agreed
Framework prohibits North Korea from construction of new nuclear facilities elsewhere in
North Korea.
Gallucci and other officials have emphasized that the key policy objective of the Clinton
Administration has been to secure a freeze of North Korea’s nuclear program in order to
prevent North Korea from producing large quantities of nuclear weapons grade plutonium
through the operations of the 50 and 200 megawatt reactors and the plutonium reprocessing
plant at Yongbyon. Gallucci has referred to the prospect of North Korea of producing
enough plutonium annually for nearly 30 nuclear weapons if the 50 and 200 megawatt
reactors went into operation. The Administration’s fear is that North Korea would have the
means to export atomic bombs to other states and possess a nuclear missile capability that
would threaten Japan and U.S. territories in the Pacific Ocean. The freeze, thus, is intended
to attain U.S. policy goals related to nuclear non-proliferation and the NPT and prevent the
emergence of a significant regional nuclear security threat.
However, the Agreed Framework does not resolve the question of North Korea’s
existing achievements regarding the production and acquisition of plutonium and the
production of nuclear weapons. The freeze will not prevent North Korea from producing a
few nuclear weapons if, according to the U.S. and foreign intelligence reports cited earlier,
North Korea has enough plutonium, sufficient technology to manufacture them, and hidden
facilities such as a pilot plutonium reprocessing laboratory, about which IAEA Director Blix
and others have speculated. Pyongyang’s continued small stockpile option appears to be a
major weakness of the Agreed Framework. This would not constitute the broad strategic
threat cited by Administration officials. However, a small nuclear stockpile would represent
a new, dangerous element to the military situation on the Korean peninsula itself, if North
Korean leaders concluded that possession of nuclear weapons provided them with insurance
against unacceptable losses if they undertook a more militarily aggressive strategy toward
South Korea.
Benefits to North Korea
Total U.S. Cost Projections. In December 1994, Ambassador Gallucci told the
Senate Foreign Relations Committee that the cost to the United States in implementing the
Agreed Framework would be in the “tens of millions of dollars.” Secretary of State
Christopher estimated $20-$30 million annually in testimony before the Foreign Relations
Committee.
Light Water Nuclear Reactors. North Korea is to receive two light water reactors
(LWRs) with a generating capacity of approximately 2,000 megawatts. The Agreed
Framework set a “target date” of 2003. The United States is obligated to organize an
international consortium arrangement for the acquisition and financing of the reactors. The
Administration and the governments of South Korea, Japan, and other countries established
in March 1995 the Korean Peninsula Energy Development Organization (KEDO) to
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coordinate the provision of the LWRs. North Korea initially rejected negotiating with either
KEDO or South Korea over the LWR project, demanding that it deal only with the United
States and that it would accept only U.S. reactors. North Korea and the United States
reached an agreement in Kuala Lumpur, Malaysia, in June 1995 under which North Korea
agreed to negotiate with KEDO. The Kuala Lumpur agreement left South Korea’s role in the
project unclear. However, South Korea’s role has become apparent because of South
Korea’s participation in subsequent KEDO- North Korea negotiations, which concluded a
supply contract in December 1995 and follow-up protocol accords in 1996. KEDO signed
the supply contract with North Korea in December 1995. With the groundbreaking at the
reactor site in August 1997, KEDO officials have changed the estimated completion date from
2003 to 2007; other experts predict a much later date.
KEDO’s estimated cost of the reactors in 1994 is currently $4.6 billion. Other estimates
have been $5.5-6.0 billion. South Korea is to supply the reactors through a South Korean
company as the main contractor; and South Korea and Japan will provide most of the
financing. The Administration’s objective is to secure all the money for the light water
reactors from other governments. It has approached Western European and Southeast Asian
countries about financial assistance. An agreement reached by KEDO members on November
9, 1998, sets South Korea’s contribution at $3.22 billion, Japan’s contribution at $1 billion,
and the European Union’s contribution at $76 million. This leaves a projected shortfall of
$305 million.
The supply contract will add to the financial costs. KEDO accepted several of North
Korea’s demands for construction of auxiliary facilities: ports, roads, a nuclear waste storage
facility, and a reactor simulator. KEDO rejected North Korea’s demand that KEDO finance
modernization of North Korea’s electric power grid. The cost of this has been estimated at
$750 million. North Korea reissued the demand in an amended form in U.S.-North Korean
talks in March 2000, calling for U.S. “compensation” for electricity shortages because the
light water nuclear reactors will not be completed by 20003.
Clinton Administration officials have noted that before construction begins, the United
States, in accord with the Atomic Energy Act, must enter into a bilateral nuclear cooperation
agreement with North Korea, since U.S. technology is incorporated into the South Korean
light water reactors that North Korea will receive. Administration officials state that light
water reactors are less dangerous than North Korea’s current graphite reactors, partly
because plutonium produced from light water reactors is more technologically difficult to use
in the manufacture nuclear weapons. They also assert that North Korea will have to secure
enriched uranium fuel for light water reactors from outside North Korea. This, the officials
claim, will give the United States leverage on the supply of fuel if North Korea should violate
the Agreed Framework. However, non-government nuclear experts assert that North Korea
could use the original supply of fuel for the reactors to produce enough plutonium annually
for up to 70 atomic bombs before the United States could react by seeking a cutoff of future
fuel shipments. Ambassador Gallucci has acknowledged that “a technical possibility” exists
that North Korea could use light water reactors to produce plutonium for nuclear weapons.
Moreover, exercising U.S. leverage over the supply of fuel would require that potential
suppliers of fuel like China and Russia coordinate their policies with the United States. The
Agreed Framework and subsequent Clinton Administration have provided no information on
the projected costs of supplying the reactor fuel.
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Oil at No Cost. Prior to the construction of light water reactors, the Agreed
Framework commits the United States to facilitate the provision to North Korea of
“alternative energy” to compensate for the freeze of nuclear facilities. The alternative energy
is to be “heavy oil”. In January 1995, the Clinton Administration arranged for the shipment
of 50,000 metric tons of U.S. heavy oil to North Korea. This was followed by a shipment of
100,000 metric tons of oil in October 1995. Starting in October 1996, the United States is
to facilitate shipments of 500,000 metric tons of heavy oil to North Korea annually until the
first of the two light water reactors becomes operational. The annual cost of the oil currently
is over $60 million. The Administration financed the initial shipment of 50,000 tons of oil
with $4.5 million from appropriated Defense Department funds designated for “emergency
expenses. The European Union joined KEDO’s executive board in May 1997 and has
provided over $15 million annually for the oil shipments. The Administration has had little
success in securing financial support from Southeast Asian and Persian Gulf countries despite
repeated requests.
The Agreed Framework states that the heavy oil is “for heating and electricity
production.” North Korea has only one oil-fired electrical power plant, but 500,000 tons of
oil annually exceeds the capacity of this plant. Other potential uses of heavy oil are for ship
transport and steel production. U.S. officials disclosed in February 1995 that North Korea
had “diverted” a “small amount” of the heavy oil received in January to industrial uses.
Ambassador Gallucci hinted that it was used in steel production. He said that the United
States and North Korea had agreed on procedures to ensure against further diversions.
However, A General Accounting Office report in late 1999 described periodic breakdowns
in the U.S. system of monitoring North Korea’s use of the heavy oil. President Clinton
notified Congress in March 2000 that he could not certify that North was not diverting heavy
oil for unauthorized purposes.
Diplomatic Representation. The United States and North Korea announced in the
Agreed Framework an intention to open liaison offices in each other’s capital and establish
full diplomatic relations if the two governments make progress “on issues of concern to each
side.” By April 1995, most technical arrangements for liaison offices were completed.
However, North Korea since has displayed more reluctance to finalize arrangements.
Ambassador Gallucci has asserted that a full normalization of diplomatic relations will depend
on a successful resolution of non-nuclear military issues, especially the heavy deployment of
North Korean conventional military forces along the demilitarized zone separating North and
South Korea and North Korea’s program to develop and sell to other governments longer
range missiles. In October 1999, William Perry, the Administration’s Special Adviser on
North Korea, cited normalization of diplomatic relations as one of the benefits which the
United States could offer North Korea for new agreements on nuclear and missile issues.
Lifting the U.S. Economic Embargo. The Agreed Framework specifies that within
three months from October 21, 1994, the two sides will reduce barriers to trade and
investment, including restrictions on telecommunications services and financial transactions.
This requires the Clinton Administration to relax the U.S. economic embargo on North
Korea, which the Truman Administration and Congress put in place during the Korean War.
On January 20, 1995, the Administration announced initial measures, including permission for
telecommunications links with North Korea, permission for U.S. citizens to use credit cards
in North Korea, permission for American media organizations to open offices in North Korea,
permission for North Korea to use U.S. banks in financial transactions with third countries,
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and permission for U.S. steel companies to import magnesite from North Korea. North
Korea since has pressed the Clinton Administration to end all economic sanctions. In U.S.-
North Korean talks in September 1999, the United States agreed to end a broader range of
economic sanctions in exchange for a North Korean moratorium on future missile testing.
North Korean Obligations Beyond the Freeze of the Nuclear
Program
North Korea’s primary obligation is the freeze of its nuclear program. However, as the
time comes for delivery to North Korea of plant and equipment for the light water reactors,
the Agreed Framework alludes to certain other obligations for Pyongyang. Ambassador
Gallucci and other Administration have been more specific in describing these. They have
disclosed the existence of a secret minute that the Administration and North Korea concluded
in conjunction with completion of the Agreed Framework. North Korea, however, has not
acknowledged such a secret minute.
Inspections. The Agreed Framework contains a clause which the Administration
claims constitutes a North Korean obligation to allow the IAEA to conduct the special
inspection of the two suspected nuclear waste sites at Yongbyon in conjunction with the
delivery of equipment for the light water reactors. However, the Agreed Framework does
not refer to “special inspections.” It does state: “When a significant portion of the LWR [light
water reactor] project is completed, but before delivery of key nuclear components, the
DPRK will come into full compliance with its safeguards agreement with the IAEA, including
taking all steps that may be deemed necessary by the IAEA, following consultations with the
Agency, with regard to verifying the accuracy and completeness of the DPRK’s initial report
on all nuclear material in the DPRK.” Ambassador Gallucci contends that this binds North
Korea to accept a special inspection before the key nuclear components of the first light water
reactor are delivered to North Korea, if the IAEA still wishes to conduct a special inspection.
However, North Korean descriptions of its obligations omit reference to special inspections.
Gallucci also stated in congressional testimony that the Agreed Framework did not
restrict the right of the IAEA to invoke special inspections if it discovered any new North
Korean nuclear activities. Gallucci said that the Agreed Framework only restricted the IAEA
with respect to the two suspected nuclear waste sites, concerning which the IAEA demanded
special inspections in 1993.
Disposition of Fuel Rods from the Five Megawatt Reactor. Following Kim Il-sung’s
offer of a nuclear freeze to former President Carter, Administration officials stressed the
importance of securing North Korean agreement to the removal to a third country of the
8,000 fuel rods which North Korea removed from the five megawatt reactor in May 1994.
The Administration abandoned the objective of securing an immediate removal of the rods
after the negotiations started in August 1994. It also gave up support for the IAEA’s
attempts to inspect the fuel rods in order to gain information on the amount of weapons grade
plutonium that North Korea secured from the five megawatt reactor prior to 1994. The
Agreed Framework provided for the storage of the rods in North Korea and a North Korean
promise not to reprocess plutonium from the rods. It also provides for subsequent talks on
the “ultimate disposition” of the rods. The Administration also has agreed to provide
technical assistance to North Korea for the safe storage of the fuel rods in a hard encasement.
The encasement process began on April 27, 1996. The Administration estimated the cost of
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this technical assistance at $5-$10 million, but the total cost in fiscal years 1996 and 1997 has
totaled $20 million. The South Korean Government, however, reportedly estimates that the
cost of safe storage of the fuel rods will be about $30 million. Over 90% of the fuel rods had
been encased in May 1998 when North Korea suspended the encasing in protest over the slow
deliveries of heavy oil. In U.S.-North Korean negotiations in August 1998, North Korea
agreed to complete the encasing.
In early 1996, the IAEA renewed attempts to inspect the fuel rods before they were
encased, only to be rebuffed by North Korea. IAEA statements indicate that the Clinton
Administration gave no support to the IAEA attempts.
The State Department asserts that the Agreed Framework constitutes a North Korean
commitment to allow the removal of the rods from North Korea “when significant nuclear
components begin to be delivered for the first LWR.” The Department adds that “The fuel
must be completely shipped out of North Korea by the time the first LWR is completed.” The
Agreed Framework does not specify removal of the fuel rods, but the supply contract states
that the fuel rods will be transferred “from the DPRK.” The South Korean Government
reportedly estimates that the cost of removal would be around $70 million. Other South
Korean experts reportedly place the costs of storage and removal higher, around $200 million.
The supply contract does not specify who would assume the cost of dismantlement.
Dismantlement of Nuclear Installations. The Agreed Framework states that
“Dismantlement of the DPRK’s graphite-moderated reactors and related facilities will be
completed when the LWR project is completed.” A State Department interpretation holds
that dismantlement will begin when the first light water reactor is installed and completed
when the second reactor is fully installed. Administration officials have not estimated the cost
of dismantlement and from where the money would come. South Korean government experts
reportedly estimate that dismantlement of the 50 and 200 megawatt reactors will cost about
$500 million but that dismantlement of the radioactive five megawatt reactor and the
plutonium reprocessing plant will require a much higher cost.
The Perry Initiative, October 1999
The 1998 North Korean long range missile launch and the disclosure of the Kumchangri
suspected nuclear underground site prompted the Clinton Administration to reassess its policy
toward North Korea. The result was the Perry initiative. William Perry, former Secretary of
Defense and Special Advisor to the President and Secretary of State on North Korea, outlined
a revised U.S. strategy in a report of October 1999. The Perry report asserted that the
Agreed Framework should continue in order to prevent North Korea from producing a
“significant number of nuclear weapons.” It recommended two sets of new U.S.-North Korea
negotiations with the objectives of securing (1) “verifiable assurances” that North Korea does
not have a secret nuclear weapons program, and (2) “verifiable cessation” of North Korea’s
missile program. Perry recommended a step by step negotiating process. Perry proposed
that, in return for commitments by North Korea on the nuclear and missile issues, the United
States should normalize diplomatic relations with North Korea, relax economic sanctions
against North Korea, and “take other positive steps” to “provide opportunities” for North
Korea. Perry stated that such U.S. initiatives should be coordinated with similar actions by
Japan and South Korea.
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The Clinton Administration took an initial step in line with Perry’s recommendations
when it negotiated an agreement with North Korea in Berlin in September 1999 in which
North Korea agreed to defer further missile launch tests in return for actions by the Clinton
Administration to lift major U.S. economic sanctions. The next planned step, a high-level
North Korean visit to Washington, was stalemated over North Korea’s demand of
preconditions. Following the dramatic summit meeting between the leaders of North Korea
and South Korea, the Clinton Administration announced officially the lifting of economic
sanctions on June 19, 1999. North Korea responded by reaffirming its agreement to defer
missile launch tests. North Korea also sent a high-level official to Washington in October
2000 followed by Secretary of State Madeleine Albright’s visit to North Korea. These talks
focused on the missile issue and particularly on a North Korean proposal made by North
Korean leader Kim Jong-il to Russian President Vladimir Putin. According to Putin, Kim
Jong-il offered to make concessions on the missile issue (the scope of the proposed
concessions are unclear) if the United States would organize a program to launch North
Korean satellites into orbit. The talks appeared to give less attention to Perry’s objective of
ensuring that North Korea does not have a clandestine nuclear weapons program.
Role of Congress
Congress potentially could exercise legislative initiatives on a number of provisions of
the Agreed Framework related to U.S. benefits to North Korea. This is especially the case
regarding a relaxation of the U.S. economic embargo, the establishment of liaison offices, or
a subsequent establishment of full diplomatic relations. Passage of sense of Congress
resolutions or issuance of committee reports constitute means for Congress to voice opinion
on the implementation of the Agreed Framework.
Congress has voiced much skepticism regarding the Agreed Framework, but its actions
have given the Administration flexibility in implementing U.S. obligations. Congress so far
has played three roles. First, there have been numerous oversight hearings. Second,
Congress included in the Omnibus Appropriations bill for FY 1999 (H.R. 4328) the
requirement that the President certify progress in negotiations with North Korea over the
nuclear, missile, and other issues before the Administration could allocate money to KEDO
operations. President Clinton issued two such certifications in March and May 1999. H.R.
4328 also called on the President to name “a very senior presidential envoy” as “North Korea
Policy Coordinator” to conduct a review of U.S. policy and direct negotiations with North
Korea. This resulted in President Clinton’s appointment of William Perry as a special adviser
and the issuance of the Perry report in October 1999.. Third, Congress has considered and
approved Administration requests for funds to finance implementation. Congress approved
for fiscal years 1996, 1997, 1998, and 1999 Administration requests for $22 million, $25
million, $30 million and $35 million respectively for U.S. support of KEDO and $20 million
for the encasing of nuclear fuel rods. For FY 2000, the Administration raised its request to
$55 million. Congress appropriated only $35 million, but President Clinton secured an
additional $18 million, using discretionary clauses in foreign operations legislation.
On October 20, 1994, President Clinton sent a letter to North Korean leader, Kim
Jong-il, stating that he “will use the full powers of my office” to carry out U.S. obligations
related to light water reactors and alternative energy (oil). President Clinton added that if
contemplated arrangements for light water reactors and alternative energy were not
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completed, he would use the powers of his office to provide light water reactors and
alternative energy from the United States “subject to the approval of the U.S. Congress.”
Another role for Congress is that of review of a prospective U.S.-North Korea nuclear
agreement that the Administration will have to negotiate with North Korea if, as expected,
South Korean-produced light water reactors contain U.S. nuclear technology. Under the
Atomic Energy Act, the President must conclude such a nuclear agreement and submit it to
Congress before U.S. nuclear technology or equipment can be transferred to a foreign
country. The President must submit a nuclear agreement to the Senate Foreign Relations
Committee and the House International Relations Committee, accompanied by a Nuclear
Proliferation Assessment Statement prepared by the Arms Control and Disarmament Agency,
Congress has 30 days of continuous session to consider the agreement; it can either adopt a
resolution of disapproval or consent to the agreement by taking no action.
On May 15, 2000, the House of Representatives passed H.R. 4251, which would give
Congress a more direct role in any U.S.-North Korean bilateral nuclear cooperation
agreement. H.R. 4251 would mandate that Congress vote approval of a nuclear cooperation
pact before it would go into affect. Such a requirement, should it become law, would be, in
effect, a congressional vote on whether to continue implementation of the Agreed
Framework.
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