UN Development Program suspends work in North Korea
05 Mar 2007 23:42:04 GMT Source: Reuters
(Recasts, previous Seoul) By Evelyn Leopold UNITED NATIONS, March 5 (Reuters) - The U.N. Development Program said on Monday it suspended operations in North Korea after Pyongyang failed to agree to changes demanded by the United States and others, who allege that funds were diverted to the communist government. David Morrison, spokesman for UNDP, said the suspension, which was expected, took effect on March 1 after North Korean officials wanted to reopen discussions the agency thought were closed on revamping its operations in the country. "They want to discuss again a further narrowing of the program," Morrison said. Among demands made by the UNDP board were that UNDP not pay in hard currency, not hire local staff through North Korean ministries and narrow the focus of its programs. The United States, backed by U.N. Secretary-General Ban Ki-moon, had made its case before UNDP's board before the recent round of Washington's talks with the North to normalize relations. The agency is also undergoing an audit of its North Korea programs. Some diplomats believe the timing worked against UNDP. On the other hand, UNICEF, the U.N. children's fund, and the World Food Program, both headed by Americans, still operate in North Korea in similar fashion. Morrison said UNDP would wait for further word from North Korea before deciding whether to pull out its eight international staff in the relatively small program. UNDP has some 20 projects with a budget of $4.4 million, including training for food management, biodiversity and others. Ad Melkert, the deputy UNDP administrator, last month said the agency would end cash payments to the North Korean government and local suppliers. Instead, everyone would be paid in won, the local currency. But he noted that hard currency would still be spent in North Korea in exchanging money at the country's central bank. A similar situation concerned hiring local staff without the government's help, since there was no free labor market in North Korea. Mark Wallace, the U.S. envoy for U.N. financial management, accused UNDP late last year of violating rules by hiring North Korean government officials to carry out its work and by paying salaries in cash through the government. He said millions of dollars may have been used to benefit North Korean leader Kim Jong-il.
