U.S. Assistance to North Korea

U.S. Assistance to North Korea

Order Code RS21834
Updated July 31, 2008
U.S. Assistance to North Korea
Mark E. Manyin and Mary Beth Nikitin
Foreign Affairs, Defense, and Trade Division
Summary
This report summarizes U.S. assistance to the Democratic People’s Republic of
North Korea (DPRK, also known as North Korea). It will be updated periodically to
track changes in U.S. provision of aid to North Korea.
Since 1995, the United States has provided North Korea with over $1 billion in
assistance, about 60% of which has paid for food aid and 40% or so paying for energy
assistance. As shown in Table 1 below, U.S. aid fell significantly in the mid-2000s,
bottoming out at zero in FY2006. The Bush Administration resumed assistance in
FY2007. In the fall of 2007, when progress began to be made in the six-party talks over
North Korea’s nuclear program, the United States began providing heavy fuel oil (HFO)
in return for Pyongyang freezing and disabling its plutonium-based nuclear facilities in
Yongbyon. The United States also is expected to provide technical assistance to North
Korea to help in the disabling and dismantling processes. In May 2008, the Bush
Administration announced it would resume food assistance to North Korea by providing
500,000 metric tons (MT). The first shipment was sent on June 29, 2008, after an
agreement on monitoring was signed. Food aid to the DPRK has been scrutinized
because Pyongyang restricts the ability of donor agencies to operate in the country.
Compounding the problem is that South Korea and China, which in recent years have
been North Korea’s two most important providers of food aid, have little to no
monitoring systems in place. In 2008, U.N. officials have called for international
donations of food to avert a “serious tragedy” in North Korea, as hunger has deepened.
Food Aid
Since 1996, the United States has sent over 2 million metric tons (MT) of food
assistance, worth about $700 million, to help North Korea alleviate chronic, massive food
shortages that began in the early 1990s. A severe famine in the mid-1990s killed an
estimated 600,000 to two million North Koreans. Over 90% of U.S. food assistance to
Pyongyang has been channeled through the U.N. World Food Program (WFP), which has
sent over 3.7 million MT of food to the DPRK since 1996. The United States has been

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by far the largest cumulative contributor to the WFP’s North Korea appeals.1 After 2002,
U.S. shipments fell steadily, bottoming out at zero in FY2006 and FY2007.
U.S. Assistance to North Korea, 1995-2008
6-Party Talks-Related
Assistance (per FY;
Medical
Food Aid (per FY)
$ million)
KEDO
Supplies
Calendar
Commodity
Assistance
& Other
or Fiscal
Metric
Value
(per calendar
Nuclear
(per FY;
Total
Year (FY)
Tons
($ million) yr; $ million) Fuel Oil
Disablement $ million)
($ million)
1995
0
$0.0
$9.5
—
—
$0.2
$9.7
1996
19,500
$8.3
$22.0
—
—
$0.0
$30.3
1997
177,000
$52.4
$25.0
—
—
$5.0
$82.4
1998
200,000
$72.9
$50.0
—
—
$0.0
$122.9
1999
695,194
$222.1
$65.1
—
—
$0.0
$287.2
2000
265,000
$74.3
$64.4
—
—
$0.0
$138.7
2001
350,000
$102.8
$74.9
—
—
$0.0
$177.7
2002
207,000
$82.4
$90.5
—
—
$0.0
$172.9
2003
40,200
$25.5
$2.3
—
—
$0.0
$27.8
2004
110,000
$52.8
$0.0
—
—
$0.1
$52.9
2005
22,800
$7.5
—
—
—
—
$7.5
2006
0
$0.0
—
—
—
$0.0
$0.0
2007
0
$0.0
—
$25.0
$20.0
$0.0
$45.0
2008
500,000a
n.a.
—
$106.0b
—
$0.0
$106.0
2009
—
n.a.
—
$15.0
—
—
$15.0
(Request)
Total 2,586,694
$701.0
$403.7
$146.0
$20.0
$5.3
$1,276.0
Sources: USAID; US Department of Agriculture; State Department; KEDO (Korean Peninsula Energy
Development Organization).
a. Some of this 500,000 MT may be distributed in FY2009. 37,000 MT was delivered starting June 30,
2008.
b. As of the end of May 2008, $53 million of this total had been allocated.
Assistance provided by the WFP also has fallen dramatically since 2001, when over
900,000 MT were shipped. The goal of the WFP’s most recent appeal, which stretches
from April 2006 through the end of August 2008, is 150,000 MT. There are two primary
reasons for the decline in WFP assistance. The first is “donor fatigue,” as contributing
nations objected to the North Korean government’s continued development of its nuclear
and missile programs as well as tightened restrictions on the ability of donor agencies to
monitor food shipments to ensure food is received by the neediest. Various sources assert
that some — perhaps substantial amounts — of the food assistance going to North Korea
1 The second largest donor of food aid to North Korea through WFP is South Korea, and the third
largest is Russia.

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is routinely diverted for resale in private markets or other uses.2 The emergence of other
emergency food situations around the globe also has stretched the food aid resources of
the United States and other donors. It is unclear whether rising global food prices in 2008
will affect the response to the WFP’s current appeal.
Second, in 2006 the WFP drastically scaled down its program in response to new
restrictions placed upon it by the North Korean government. In response, the WFP and
Pyongyang negotiated a new agreement that would feed 1.9 million people, less than a
third of the 6.4 million people the WFP previously had targeted. North Korea’s total
population is approximately 22 million. In the deal, the WFP expatriate staff was cut by
75%, to 10 people, all of whom are based in Pyongyang. Before 2006, the WFP had over
40 expatriate staff and six offices around the country conducting thousands of monitoring
trips every year.3
In 2008, the WFP has warned that food shortages and hunger had worsened to levels
not seen since the late 1990s. In April 2008, the agency issued a call for more
international donations and for the North Korean government to relax its restrictions on
donor activities.4 The following month, the United States Agency for International
Development announced that the United States would resume food assistance to North
Korea by providing 500,000 MT for one year beginning in June 2008. 400,000 MT
would be channeled through the WFP. In a new innovation, approximately 100,000 tons
would be funneled through non-governmental organizations (NGOs), including World
Vision and Mercy Corps. The announcement stated that the resumption was made
possible by an understanding reached with Pyongyang that allowed for “substantial
improvement in monitoring and access in order to allow for confirmation of receipt by the
intended recipients.”5 On June 27, an agreement was signed with Pyongyang that
stipulated terms for increased WFP personnel and access for monitoring the delivery of
the food aid. It allows WFP to expand its operations into 128 counties, versus an earlier
50, in regions at particular risk of famine. The NGO portion of the distribution is to be
done in the two northwestern provinces of Chagang and North Pyongan.6 On June 30, a
US ship delivered 37,000 tons of wheat to North Korea.7
2 See, for instance, Stephan Haggard and Marcus Noland, Hunger and Human Rights: The
Politics of Famine in North Korea (Washington, DC: U.S. Committee for Human Rights in North
Korea, 2005), in which the authors argue that up to half of the WFP’s aid deliveries did not reach
their intended recipients.
3 WFP Press Release, “WFP Set to Resume Operations in North Korea,” 11 May 2006; undated
WFP document, Projected 2007 Needs for WFP Projects and Operations, Korea, DPR.
4 WFP Press Releases: “WFP Warns of Potential Humanitarian Food Crisis in DPRK Following
Critically Low Harvest, April 16, 2008; “DPRK Survey Confirms Deepening Hunger for
Millions, July 30, 2008.
5 USAID Press Release, “Resumption of U.S. Food Assistance to the North Korean People,” May
16, 2008.
6 “Agreement reached as first US ship arrives in DPRK with food aid,” World Food Program
Press Release, June 30, 2008. [http://www.wfp.org/english/?ModuleID=137&Key=2877]
7 “U.S. Wheat Begins New Aid to North Korea,” The Washington Post, July 1, 2008.

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U.S. official policy in recent times has de-linked food and humanitarian aid from
strategic interests. Since June 2002, the Bush Administration officially has linked the
level of U.S. food aid to three factors: the need in North Korea, competing needs on U.S.
food assistance, and “verifiable progress” in North Korea allowing the humanitarian
community improved access and monitoring.8 In practice, some argue that the timing for
U.S. pledges sometimes appears to be motivated also by a desire to influence talks over
North Korea’s nuclear program, and that the linkage between U.S. donations and
improvements in North Korea’s cooperation with the WFP occasionally has been
tenuous.9
Energy Assistance
KEDO. From 1995 to 2002, the United States provided over $400 million in energy
assistance to North Korea under the terms of the 1994 Agreed Framework, in which the
DPRK agreed to halt its existing plutonium-based nuclear program in exchange for energy
aid from the United States and other countries. The planned assistance, to be managed
by the Korean Energy Development Organization (KEDO), consisted of the construction
of two light-water nuclear reactors (LWRs) and the provision of 500,000 tons of heavy
fuel oil while the reactors were being built. KEDO halted fuel oil shipments after an
October 2002 dispute over North Korea’s alleged clandestine uranium enrichment
program. The Bush Administration then sought to permanently end the KEDO program.10
In 2003 and 2004, KEDO’s Executive Board (the United States, South Korea, Japan, and
the European Union) decided to suspend construction on the LWRs for one year periods.
In the fall of 2005, the KEDO program was terminated. In January 2006, the last foreign
KEDO workers left the LWR construction site.
Assistance Related to the Six-Party Talks. For years, Administration
officials, including President Bush, have said that U.S. development assistance would be
forthcoming if North Korea begins dismantling its nuclear programs. In January 2003,
President Bush said that he would consider offering the DPRK a “bold initiative”
including energy and agricultural development aid if the country first verifiably
dismantles its nuclear program and satisfies other U.S. security concerns dealing with
missiles and the deployment of conventional forces.11 In June 2004, the United States
offered a proposal that envisioned a freeze of North Korea’s weapons program, followed
by a series of measures to ensure complete dismantlement and, eventually, a permanent
security guarantee, negotiations to resolve North Korea’s energy problems, and
discussions on normalizing U.S.-North Korean relations that would include lifting the
remaining U.S. sanctions and removing North Korea from the list of terrorist-supporting
8 USAID Press Release, June 7, 2002.
9 Andrew S. Natsios, The Great North Korean Famine, United States Institute of Peace Press,
Washington, DC, 2001, pp. 135, 143-148. Mark Noland, Avoiding the Apocalypse: The Future
of the Two Koreas, Peterson Institute of International Economics, June 2000, pp. 159, 186, 189.
10 State Department Daily Press Briefing by Adam Ereli, Deputy Spokesman, November 5, 2003.
11 The Administration reportedly was preparing to offer a version of this plan to North Korea in
the summer of 2002, but pulled it back after acquiring more details of Pyongyang’s clandestine
uranium nuclear weapons program. Testimony of Richard Armitage, State Department Deputy
Secretary, before the Senate Foreign Relations Committee, February 4, 2003.

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countries.12 In September 2005, the Six Parties issued a joint “statement of principles,”
in which they agreed to “promote economic cooperation in the fields of energy, trade and
investment, bilaterally and/or multilaterally,” and the United States, China, South Korea,
Japan, and Russia “stated their willingness to provide energy assistance to the DPRK.”
The agreement stated that the parties would discuss the provision of a light water reactor
to North Korea “at the appropriate time.”
North Korea tested a nuclear device in October 2006, resulting in the passage of UN
Security Council Resolution 1718, which imposed international sanctions banning trade
of military goods, WMD and missile-related goods, and luxury items to North Korea. In
the six-party talks held in December 2006, as well as meetings held earlier that month
with North Korean negotiators, U.S. officials reportedly spelled out a detailed package of
humanitarian, economic, and energy aid that would be available to Pyongyang if it gave
up nuclear weapons and technology.13 The resulting Denuclearization Action Plan of
February 2007 called for a first phase to include the shut-down and disablement of key
nuclear facilities and initial provision of 50,000 tons of heavy fuel oil to North Korea. In
the second phase, the parties agreed to provide North Korea with “economic, energy and
humanitarian assistance up to the equivalent of 1 million tons of heavy fuel oil, including
the initial shipment of 50,000 tons of heavy oil.”
The shipments of fuel oil or equivalent assistance were to happen on an “action for
action” basis, as North Korea made progress on the second phase (nuclear disablement
at Yongbyon and declaration of nuclear facilities and activities). An October 2007 joint
statement on “Second-Phase Actions” confirmed these commitments. North Korea has
received a total of 330,000 tons of heavy fuel oil and 60,000 tons of fuel equivalent (i.e.,
steel products to renovate aging power plants).14 The United States has so far contributed
134,000 tons of heavy fuel oil.15 North Korea has equated actions on disablement with
the shipments of energy assistance, and has thus slowed down removal of the spent fuel
rods at Yongbyon, saying that while 80% of the disablement steps have been completed,
only 36% of energy aid has been delivered.16 Of the planned aid, half is heavy fuel oil
provided by the United States and Russia, and the rest is to be energy facilities/equipment
equivalent to 500,000 tons of heavy oil provided by China and South Korea. The parties
plan to conclude disablement and heavy fuel oil delivery contracts by the end of October
2008.17
12 See CRS Report RL30613, North Korea: Terrorism List Removal? by Larry Niksch.
13 Helene Cooper and David Sanger, “U.S. Offers North Korea Aid for Dropping Nuclear Plans,”
New York Times, December 6, 2006.
14 As of the Six-party Working Group Meeting on Economic and Energy Cooperation, June 10-
11, 2008.
15 Condoleezza Rice, “Diplomacy on North Korea Is Working,” The Wall Street Journal, June
26, 2008. [http://www.state.gov/secretary/rm/2008/06/106282.htm]
16 Lee Chi-dong, “N Korea Complains About Slow Provision of Energy Aid,” Yonhap News,
June 5, 2008.
17 Christopher Hill, Testimony to the Senate Armed Services Committee, July 31, 2008.

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The Departments of State and Energy are working to disable the nuclear facilities at
the Yongbyon complex in North Korea. The State Department’s Nonproliferation and
Disarmament Fund (NDF) has provided approximately $20 million for this purpose to
date. NDF is paying the North Korean government for the labor costs of disablement
activities, and is also purchasing related equipment and fuel. DOE has contributed $15
million in its own personnel costs related to phase two.18 NDF funds may be used
“notwithstanding any other provision of law” and therefore may be used in North Korea.
North Korea’s nuclear test triggered sanctions under Section 102 (b) (the “Glenn
Amendment” U.S.C. 2799aa-1) of the Arms Export Control Act which prohibits
assistance to a non-nuclear weapon state under the NPT that has detonated a nuclear
explosive device. DOE funds cannot be spent in North Korea due to this restriction. In
the FY2008 supplemental appropriations act, P.L. 110-252, Congress gave the President
authority to waive the Glenn Amendment restrictions for the purpose of eliminating
WMD and missile-related programs in North Korea.19 The Congressional Budget Office
estimated that nuclear dismantlement in North Korea will cost approximately $575
million and take about four years to complete.20
Beyond the Glenn amendment restrictions, Department of Defense funds must be
specifically appropriated for use in North Korea. Section 8045 of the FY2008 Defense
Appropriations Act (P.L. 110-116) says that “none of the funds appropriated or otherwise
made available in this act may be obligated or expended for assistance to the Democratic
People’s Republic of Korea unless specifically appropriated for that purpose.” However,
this year authorization was given for CTR funds to be used globally (see Section 1305).
The FY2008 Defense Authorization Act (P.L. 110-181) specifically encourages “activities
relating to the denuclearization of the Democratic People’s Republic of Korea” as a
potential new initiative for CTR work. Currently, the Department of Defense is not
working on disablement efforts, but there may be a future role for DOD as the Six Party
process progresses to dismantlement work.
The North Korean Human Rights Act
In the fall of 2004, the 108th Congress passed and President Bush signed H.R. 4011
(P.L. 108-333), the North Korea Human Rights Act. The act included provisions dealing
with U.S. assistance to North Korea, including a requirement that U.S. non-humanitarian
assistance to North Korea be contingent upon North Korea making “substantial progress”
on a number of specific human rights issues, and hortatory language stating that
“significant increases” above current levels of U.S. support for humanitarian assistance
should be conditioned upon “substantial improvements” in transparency, monitoring, and
access. A measure to reauthorize the act in the 110th Congress, H.R. 5834, would drop
these provisions, though it does retain a requirement that USAID report annually to
Congress on efforts to improve transparency and monitoring in U.S. humanitarian
assistance to the DPRK. The House passed H.R. 5834 on May 15, 2008.
18 William H. Tobey, Testimony to the Senate Armed Services Committee, July 31, 2008.
19 A version of the waiver that includes certifications to Congress that North Korea is verifiably
dismantling its program is contained in H.R. 5916, which passed the House on May 15, 2008.
20 Congressional Budget Office, “Cost Estimate: S. 3001 National Defense Authorization Act for
Fiscal Year 2009,” June 13, 2008. [http://www.cbo.gov/ftpdocs/93xx/doc9390/s3001.pdf]