The US government has indicated to the US congress that it is prepared to pay all the $47 million required to complete an annual shipment of fuel oil to North Korea as part of an international agreement that will result in North Korea abandoning its home-grown nuclear power programme.
By offering to pay for the oil, the US will break an impasse between Japan and South Korea over sharing the cost of the fuel. Delivery of fuel oil was part of the agreement signed by North Korea and the Korea Peninsula Development Organization (KEDO).
Under this deal, signed in 1994, North Korea agreed to abandon its domestic nuclear power programme in exchange for two modern light water reactors, along with an annual supply of 450 000 t of fuel oil until the reactors were completed.
South Korea was intitally intending to underwrite most of this project, but the financial crisis which struck the country last summer has made this difficult. As a result, fuel oil shipments have been suspended and the construction of the nuclear units has been delayed.
KEDO suffered a deficit of $47 million in the latest accounting year for procuring oil for North Korea. In retaliation, North Korea has threatened to restart its indigenous nuclear programme. The US offer should allow the project to return to a normal footing.