Order Code IB91141
Issue Brief for Congress
Received through the CRS Web
North Korea’s Nuclear
Weapons Program
Updated November 8, 2002
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
Implications of North Korea’s Secret Nuclear Program, October 2002
Bush Administration Policy
North Korea’s Nuclear Program
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
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
Disposition of Fuel Rods from the Five Megawatt Reactor
Dismantlement of Nuclear Installations
Role of Congress

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North Korea’s Nuclear Weapons Program
SUMMARY
North Korea’s nuclear weapons program
The pace of implementation of the
became an immediate foreign policy issue
Agreed Framework has been very slow.
facing the United States because of North
Instead of the original target date of 2003, it
Korea’s refusal to carry out its obligations
generally is estimated that completion of the
under the Nuclear Non-Proliferation Treaty
light water reactors will not take place until
(NPT) and other nuclear accords it had signed.
well beyond 2010.
North Korea has constructed nuclear reactors
and a plutonium reprocessing plant at a site
The United States has faced several
called Yongbyon. U.S. intelligence assess-
policy problems since the signing of the
ments have concluded that North Korea prob-
Agreed Framework, including securing money
ably has manufactured at least one nuclear
annually to finance heavy oil shipments to
weapon.
North Korea (the cost of the oil has risen from
about $30 million in 1995 to over $100 mil-
The United States and North Korea
lion), suspicions of clandestine North Korean
signed an agreement on October 21, 1994, that
nuclear activities, and North Korea’s develop-
offers North Korea a package of benefits in
ment of long range missiles. In October 2002,
return for a freeze of North Korea’s nuclear
under U.S. diplomatic pressure, North Korea
program. Benefits to North Korea include:
admitted that it was conducting a secret nu-
light water nuclear reactors totaling 2,000
clear weapons program based on uranium
electric megawatts; shipments of “heavy oil”
enrichment. The Bush Administration de-
to North Korea (50,000 tons in 1995 and
manded that North Korea end the secret pro-
500,000 tons annually beginning in 1996 until
gram in accord with its commitments to the
the first light water reactor is built).
International Atomic Energy Agency.
Congressional Research Service ˜ The Library of Congress

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MOST RECENT DEVELOPMENTS
The Bush Administration disclosed on October 16, 2002, that North Korea had revealed
to U.S. Assistant Secretary of State James Kelly in Pyongyang that it was conducting a secret
nuclear weapons program based on the process of uranium enrichment. The Bush
Administration’s initial policy response is a demand that North Korea end the secret
program under the supervision of the International Atomic Energy, and diplomatic efforts
to enlist the support of Japan, South Korea, and China to pressure North Korea.
BACKGROUND AND ANALYSIS
Implications of North Korea’s Secret Nuclear Program,
October 2002
North Korea’s revelation of its secret nuclear weapons program reportedly contained
three elements. First, North Korea admitted the program in response to U.S. evidence
presented by Assistant Secretary of State Kelly. The program is based on the process of
uranium enrichment, in contrast to North Korea’s pre-1995 nuclear program based on
plutonium reprocessing. North Korea began a secret uranium enrichment program after
1995 reportedly with the assistance of Pakistan. North Korea provided Pakistan with
intermediate range ballistic missiles in the late 1990s. Second, Vice Foreign Minister Kang
Sok-ju (an important figure in the North Korean regime) declared to Kelly that North Korea
also possesses “more powerful” weapons. Third, North Korea is demanding the negotiation
of a new agreement on nuclear issues and is issuing threats of unilateral military actions.
The first implication for U.S. policy is the balancing of the U.S. response to North
Korea with the Bush Administration’s priority to Iraq in U.S. diplomacy and probably in
preparations for war with Iraq. The revelation of the secret North Korean nuclear program,
however, creates the need for at least an initial policy response. U.S. allies, South Korea and
Japan, have ongoing negotiations with North Korea. Also, the International Atomic Agency
(IAEA) has requested information on the secret nuclear program from North Korea and has
said that it will ask the Bush Administration for U.S. intelligence information on the secret
program. The IAEA has a safeguards agreement with North Korea providing for inspections
(see section on “Diplomatic Background to the Agreed Framework and Amending
Agreements”). The United States in the past has provided intelligence information on North
Korea’s nuclear program to the IAEA.
The second implication is for longer term U.S. responses and involves several issues.
The first is whether to negotiate with North Korea, seeking a new agreement dealing with the
secret program, or whether to insist first that North Korea fulfill the procedures set out in the
1992 North Korea-IAEA safeguards agreement. That agreement sets out specific procedures
under which North Korea would disclose the specifics of the secret program, put the program
under IAEA safeguards inspections, and allow to IAEA to conduct “special inspections” of
any unrevealed suspicious activities. The second issue would be whether to attempt to
continue the 1994 Agreed Framework or suspend or terminate it in view of the general view
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that the North Korean secret program constitutes a major violation of it. Bush
Administration officials described the secret nuclear program as a violation of the Agreed
Framework. In congressional testimony shortly after the signing of the Agreed Framework,
Secretary of State Warren Christopher, Secretary of Defense William Perry, and Ambassador
Robert Gallucci (who negotiated the Agreed Framework) all said that if North Korea
conducted secret nuclear activities, the United States would terminate its obligations under
the Agreed Framework. Gallucci testified that the United States would support demands by
the IAEA for inspections of secret nuclear programs. The third issue would be consideration
of coercive measures if North Korea refuses to end the secret nuclear program. Past
consideration of coercive measures have included economic sanctions and military measures.
Bush Administration Policy
North Korea’s admission of a secret uranium enrichment program in October 2002
confirmed U.S. intelligence information that had built up since 1998 concerning such a
program. In addition to warning that it possesses “big powerful weapons,” North Korea
demanded a negotiation with the United States to include a non-aggression pact and a
guarantee against a U.S. military and/or nuclear attack, and an end to U.S. stifling of North
Korean economic development. It threatened to re-open the nuclear facilities shut down
under the Agreed Framework, expand weapons proliferation to other countries, and conduct
a new long-range missile test.
The Bush Administration’s initial policy response to the secret program consists of:
(1) Continuing priority to Iraq. President Bush reportedly has said that he does not want
two simultaneous crises. U.S. officials say they will rely on diplomacy and expect diplomacy
to run well into 2003.
(2) No immediate termination or suspension of the Agreed Framework. Many
Administration officials have stated that the Agreed Framework will be terminated.
President Bush reportedly told Japanese and South Korean leaders at the APEC summit in
late October 2002 that the Agreed Framework would be continued indefinitely. Statements
indicate a debate with the Administration, possibly over whether to continue the Agreed
Framework or the timing of ending it. The timing question could be related to the policy of
priority to Iraq. Scheduled shipments of heavy oil – a U.S. obligation under the Agreed
Framework – appear to be intensifying the debate and pressures within the Administration
over policy toward the Agreed Framework. The next oil shipment is scheduled for the end
of November 2002. Following the 2002 U.S. elections, Congress will complete legislation
of the FY2003 foreign operations appropriations bill, which contains money for the Korean
Peninsula Energy Development Organization (KEDO) and the heavy oil shipments. Japan
and South Korea favor continuing the Agreed Framework indefinitely.
(3) Rejecting negotiation of any new agreement with North Korea over the secret
nuclear program and insisting that North Korea first abide by its past nuclear agreements,
especially placing the secret program under IAEA safeguards and dismantling it under IAEA
supervision. Administration officials argue that negotiation of a new agreement would
reward North Korea for violations of the Agreed Framework, the 1992 IAEA-North Korea
safeguards agreement, and the 1992 North Korea-South Korea denuclearization agreement.
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U.S. officials indicate that the Administration would continue dialogue with North Korea,
including periodic meetings between State Department officials and North Korean officials
at the United Nations. They have not indicated the purpose of dialogue in the absence of a
negotiation, an important issue in future U.S. diplomacy.
(4) Forming an international coalition to pressure North Korea to end the secret
program. President Bush, Japan’s Prime Minister Koizumi, and South Korea’s President
Kim Dae-jung issued a statement at the APEC summit on October 26, 2002, that North
Korea should “dismantle this program in a prompt and verifiable manner and to come into
full compliance with all its international [nuclear] commitments” The Administration has
agreed to continued Japanese and South Korean talks with North Korea but has urged Japan
not to commit any of the economic aid (up to $10 billion estimated) that Koizumi promised
to North Korea in the Japan-North Korean agreement to begin talks to normalize relations
on September 17, 2002. Japanese officials have stated repeatedly that Japan will not commit
any aid until North Korea satisfies U.S. and Japanese concerns over the secret nuclear
program and other security issues. Coordination of U.S. and Japanese diplomacy toward
North Korea is an important issue for the Bush Administration. The Administration has
asked for Chinese cooperation and reportedly requested that China warn North Korea against
re-opening the nuclear facilities shut down under the Agreed Framework.
(5) Stating that the Administration does not intend to attack North Korea militarily but
warning of the prospect of economic sanctions if North Korea does not end the secret nuclear
program. U.S. officials indicate that the Administration would not consider sanctions until
the Iraq issue is settled. References to economic sanctions have produced an open dispute
with South Korea; President Kim Dae-jung stated that he is unalterably opposed to economic
sanctions. He said in a speech of October 30, 2002, that sanctions “would likely lead to a
repeat of the nuclear crisis in the early 1990s.”
The Administration’s response to the secret nuclear program is set on the background
of a progressively hard U.S. policy toward North Korea in 2001 and 2002. As part of a
policy review toward North Korea, President Bush issued a statement on June 6, 2001,
outlining policy objectives related to implementation of the U.S.-North 1994 Agreed
Framework on North Korea’s nuclear program, North Korea’s missile program, and its
conventional forces. He stated that if North Korea took positive actions in response to U.S.
policy, the United States “will expand our efforts to help the North Korean people, ease
sanctions, and take other political steps.” President Bush’s designation of North Korea as
part of an “axis of evil” in his January 29, 2002 State of the Union address clarified the
Administration’s policy that emerged after the June 6 statement. The policy is aimed at
reducing and/or eliminating basic elements of North Korean military power, including
nuclear weapons and/or nuclear weapons-grade materials, weapons of mass destruction
(WMDs), and conventional artillery and rocket launchers positioned on the demilitarized
zone (DMZ) within range of the South Korean capital, Seoul. The Administration’s
emphasis on WMDs mounted after the Central Intelligence Agency gained documentary
evidence in Afghanistan that al Qaeda seeks WMDs (including nuclear weapons) and plans
new attacks on the United States. This reportedly influenced the Bush Administration to
broaden the definition of the war against terrorism to include states like North Korea that
potentially could supply WMDs to al Qaeda.
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The Administration’s strategy is to employ public accusations and warnings to pressure
North Korea to make policy changes regarding its military assets in line with U.S. objectives.
(For a discussion of overall Bush policy toward North Korea, see CRS Issue Brief IB98045,
Korea: U.S.-South Korean Relations–Issues for Congress.) The Bush policy statement of
June 6, 2001, declared an objective of “improved implementation of the Agreed Framework
relating to North Korea’s nuclear activities.” According to Administration officials, the
policy insists that North Korea soon begin the process of coming into full compliance with
its obligations to the International Atomic Energy Agency (IAEA). The Administration
asserts that North Korea must begin this process well prior to the point when the Agreed
Framework specifies that North Korea must be in full compliance, since the IAEA states that,
once North Korea allows a full range of IAEA inspections, the IAEA will need three to four
years to determine whether North Korea is in full compliance with the Nuclear Non-
Proliferation Treaty, to which it is a signatory. U.S. officials reportedly have said that point
will come by 2005 when construction of the light water nuclear reactors promised to North
Korea under the Agreed Framework will reach the stage of delivery of nuclear components.
Beginning in July 2001, Administration officials warned that if North Korea does not begin
the process of compliance with its obligations to the IAEA, the Administration would
suspend the light water reactor project. State Department spokesman Richard Boucher
declared on November 30, 2001, that North Korea must start compliance “now” and that:
“You have to start early. It’s not a matter of showing up the day before the containment
vessel [carrying the nuclear components] arrives; it’s a matter of working over a period of
something like three years.” When President Bush waived certification in March 2002 that
North Korea was in compliance with the Agreed Framework, Administration officials
asserted that this was an added warning to North Korea to begin the process of compliance
with its obligations to the IAEA.
The following is background related to North Korea’s nuclear program, the 1994
Agreed Framework, and U.S. policy since the Agreed Framework.
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.
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! 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
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.
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
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
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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
In August 2001, Secretary of Defense Donald Rumsfeld stated in Moscow that “North
Korea possessed enough plutonium to produce two to three, maybe even four to five nuclear
warheads.” This was largest official U.S. estimate of the possible number of North Korean
nuclear weapons. U.S. intelligence agencies had disclosed an estimate that North Korea had
extracted enough plutonium from its nuclear reactor to produce one or two nuclear weapons.
However, in December 2001, the U.S. National Intelligence Council issued a revised finding
that “North Korea has produced one, possibly two, 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 estimated 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 — sufficient for one or two atomic bombs. The CIA and DIA
apparently based 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
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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 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
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”
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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. In May 2002, U.S. Undersecretary of State
John Bolton cited the U.S. intelligence estimate of December 2001 (see above) in accusing
North Korea of operating a secret nuclear program.
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
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), which
requires North Korea to report all nuclear programs to the IAEA and gives the IAEA the right
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to conduct a range of inspections of North Korean nuclear installations and programs. 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
reprocessing plant and stored fuel rods. According to Gallucci, the freeze includes a halt to
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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 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].” Clinton Administration officials
reportedly 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 emphasized that the key policy objective of the Clinton
Administration was 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 referred to the prospect of North Korea producing enough plutonium
annually for nearly 30 nuclear weapons if the 50 and 200 megawatt reactors went into
operation. The Administration’s fear was 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. The Agreed Framework limited the IAEA’s role with regard to
the “graphite-moderated reactors and related facilities” to monitoring the freeze. The special
inspection of the suspected nuclear waste site and the inspection of the stored fuel rods are
postponed.
Benefits to North Korea
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
Clinton Administration and the governments of South Korea, Japan, and other countries
established in March 1995 the Korean Peninsula Energy Development Organization (KEDO)
to 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 changed the estimated completion date from
2003 to 2007; other experts predict a much later date.
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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 Clinton Administration’s objective was to secure all the money for the light
water reactors from other governments. It 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.
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 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 stated 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 asserted that North Korea will have to secure
enriched uranium fuel for light water reactors from outside North Korea. This, the officials
claimed, 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 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 U.S. statements have provided no
information on the projected costs of supplying the reactor fuel.
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 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
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Southeast Asian and Persian Gulf countries despite repeated requests. The annual cost of the
heavy oil has risen from about $30 million in 1995 to over $100 million in 2001.
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 asserted that a full normalization of diplomatic relations would 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 required 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, and permission for U.S. steel companies to import magnesite from North Korea.
North Korea 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.
President Clinton ordered the end of most economic sanctions in June 2000.
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
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Gallucci and other Clinton Administration officials were 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 contended
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 and the stored fuel rods. He stressed
that any North Korean nuclear program, other than the specific facilities and activities
covered in the Agreed Framework, would fall immediately under the IAEA-North Korea
safeguards agreement and that North Korea must place any such program under IAEA
safeguards. Failure to do so, he said, would constitute a violation of the Agreed Framework.
President Bush’s statement of June 6, 2001, on U.S. policy toward North Korea asserted
that the Administration would seek “improved implementation of the Agreed Framework
relating to North Korea’s nuclear activities.” Administration officials said that North Korea
must comply fully with its obligations to the IAEA or face a suspension of the light water
reactor project prior to the time when nuclear components for the reactors are to be delivered
to North Korea. U.S. officials reportedly have stated that the time for delivery of the nuclear
components could be late 2003 or 2004. They have warned that North Korea must begin to
comply soon since the IAEA says it will need three to four years to complete its work of
verifying North Korea’s past nuclear activities. Statements by Administration officials in
November 2001, including a statement by President Bush, pressed North Korea to begin
compliance with the IAEA immediately.
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
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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. 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. It was completed by September 1999.
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. 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.
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 FY1999 (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
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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 FY2000, 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. For FY2001, Congress appropriated the entire $55 million
requested by the Clinton Administration. For FY2002, the Bush Administration has
requested a funding increase to $95 million because of the rising cost of over $100 million
annually for the heavy oil supplied to North Korea.
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
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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