N Korea, US to hold atomic, finance talks

Tokyo, Jan 22 | Updated: Jan 23 2007, 05:30am hrs
The United States and North Korea have agreed in principle to hold parallel talks on US financial restrictions and Pyongyang's nuclear programmes, Kyodo news agency reported on Monday. North Korea's focus on US financial restrictions has impeded progress in six-party talks on its nuclear programmes, the last round of which ended in December without progress.

Quoting diplomatic sources close to the talks in Beijing, Kyodo said that US negotiator Christopher Hill and his North Korean counterpart, Kim Kye-gwan, had agreed to the parallel talks when they met in Berlin last week. The two men have returned to their capitals to discuss specifics and would hold more discussions on the plan during the next round of six-party talks.

Kyodo said that part of the Berlin agreement included US consideration of taking steps to release some of the $24 million in North Korean accounts that have been frozen at the bank.

No further details were given, but US officials last week told Reuters that the US Treasury Department is scrutinising the accounts in Banco Delta Asia, which it has designated a "money-laundering concern", to see if some of the money could be considered legitimate and released to Pyongyang.

Washington accuses the bank of handling North Korean money gained from counterfeiting and smuggling. Hill told reporters in Beijing on Monday that he saw potential for progress in the six-party talks based on discussions held over the last week, but cautioned that there was no certainty of a breakthrough.