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RPT-Q+A-What does the freeze in oil aid mean to N.Korea?
15 Dec 2008 05:26:47 GMT
Source: Reuters
(Repeats item sent on Sunday with no changes to text)

By Jon Herskovitz

SEOUL, Dec 14 (Reuters) - North Korea at the weekend threatened to slow the pace of taking apart its nuclear plant that produces bomb-grade plutonium in response to the United States saying it would suspend energy aid to the destitute state.

The U.S. move was prompted by the secretive North failing at multilateral disarmament talks last week to agree to a system to check claims it made about its nuclear arms programme as a part of a deal it reached with five regional powers. [ID:nSEO144069]

The following are some questions and answers about the impact of the recent U.S. and North Korean moves:

* How much does the energy aid cut hurt North Korea?

North Korea, heavily dependent on hydroelectric power, is plagued by chronic energy shortages that are at their worst in winter when rivers freeze over.

The cut in oil aid coming just as the winter settles over the Korean peninsula will make an already bad situation worse.

The North is even more dependent on this aid after having ended cooperation with South Korea, which was once one of its major benefactors.

Even without the aid, more than two-thirds of its industrial facilities are idle due to a lack of power, experts have said.

The main purpose of the North's Soviet-era nuclear reactor is to produce fissile material -- not electricity.

* How serious is North Korea's latest threat?

Most of the disablement steps, which began about a year ago, have been completed and are aimed at taking at least a year to reverse in their entirety. The last major step that has not been completed is removing irradiated fuel rods from its reactor.

The North has made similar threats several times over the past months and the latest one does not amount to much.

* What are the risks then?

North Korea does not like to be ignored and it has two main options for grabbing attention. It can rattle sabres with provocative military moves such as test firing missiles or it can ratchet up pressure by pushing forward its nuclear programme.

Instead of slowing disablement, the North could work to restart its Yongbyon nuclear plant, which has already produced enough plutonium for at least six to eight bombs.

Experts said it would look to first rebuild its plant that separates plutonium from spent nuclear fuel rods. The North could produce enough material for one more nuclear bomb from the irradiated fuel rods in the reactor and from those that have been discharged and are in cooling tanks at Yongbyon.

The North times its moves for maximum political impact and it could raise stakes just as President-elect Barack Obama takes office in January in order to force its way to near the top of the agenda of his new administration.

The North's biggest pressure tactic would be a second nuclear test, after holding its first in October 2006.

* What happens if the nuclear talks stall yet again?

The longer North Korea delays the disarmament process the more time it has to miniaturise a nuclear weapon so that it can be mounted on a warhead, and the more time it has to work on a second route for developing atomic arms by enriching uranium.

The North has abundant supplies of natural uranium in its territory and the advantage of the uranium enrichment is that it can be done away from the prying eyes of spy satellites.

* What else can be done to put pressure on Pyongyang?

The United States, which removed the North from a State Department terrorism blacklist for making progress in disarmament, could place Pyongyang back on the list.

Such a move would pose political risks for Washington because critics would question the criteria for listing.

If North Korea is back on the list, it would see a return of trade sanctions. Also it would no longer be able to tap into international institutions such as settlement banks that make it possible to move money out of the reclusive country through wire transfers and not through cash-stuffed suitcases.

(Editing by Jeremy Laurence)


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