Macau Money Returned to North Korea

The frozen Banco Delta Asia money has been returned to North Korea:

Money at the heart of a dispute that caused North Korea to delay its nuclear disarmament was finally making its way Friday to the communist nation after months of delay.

The transfer of funds previously frozen in a Macau bank could lead North Korea to start shutting down its nuclear weapons program. But the North is certain to want to count every last penny of its $25 million before fulfilling a February pledge to stop making atomic bombs.

“The transfer is in progress,” South Korea’s chief nuclear envoy, Chun Yung-woo, told reporters Friday. “Let’s wait and see how long it takes for North Korea to confirm it.”

Just to remind people the BDA money was frozen by the US Treasury Department not because of the NK nuclear issue, but because of the totally separate issue of NK counterfeiting of US currency and then laundering of the money through Banco Delta Asia.

Additionally something else that is important realize and that the the media has consistently missed is that the return of the BDA money was never part of the February denuclearization agreement.  It was a condition added by the North Koreans after signing the agreement because they knew the Bush administration was desperate to keep the deal together in order to show some kind of foreign policy success.  To keep this charade of a foreign policy success together the Bush administration agreed to return the money despite the fact that it compromises US counterfeiting laws.

Once the US agreed to allow NK to receive the BDA money they made further demands that the money had to be electronically transferred.  The North Koreans could have simply drove a truck to Banco Delta Asia in Macau and loaded it with the money and than chartered a plane to fly it back to North Korea.  They instead made the demands for a wire transfer because it would allow NK to rejoin the international banking system thus overriding the US Treasury Department sanctions.

However, the money is so tainted that no international bank wanted anything to do with NK’s money.  Amazingly enough the US State Dept. then tried to enlist the US Wachovia bank to launder Kim Jong-il’s money for him.  Wachovia justifiably declined and the State Dept. was forced to use our own American Federal Reserve bank and a Russian bank to launder Kim Jong-il’s ill gotten money instead:

 Japan’s Kyodo news agency, citing Macau financial authorities, said the funds were expected to be transferred through the New York branch of the Federal Reserve and Russia’s central bank to a Russian bank where North Korea holds accounts.

Russia said Wednesday it would allow one of its banks to transfer the funds if Washington gave written guarantees it would not fall foul of U.S. sanctions against North Korea.

It is incredible the lengths the current US government have gone to appease North Korea.  The current appeasement policy makes former President Clinton’s 1994 Agreed Framework policy of appeasement seem mild in comparison.  At least Clinton never agreed to launder North Korean money.

So now the big question everyone is wondering is if North Korea is going to denuclearize.  I have said this over and over again and the answer is no.  North Korea may shut down their reactor for awhile at some point after it has extracted all the aid and money it can get out everyone, but it will never give up it’s nuclear weapons.

Kim Jong-il developed nuclear weapons in order to appease his military eager to join the prestigious nuclear club and to ensure regime survival.  He is using the current six party talks to buy time to perfect his nuclear weapons program.  Once Kim Jong-il has successfully created a half dozen nuclear weapons he will be able to fully implement what Richardson at DPRK Studies calls Strategic Disengagement.

Before strategically disengaging, Kim will get all that he can from the international community in what I call the North Korean Freeze Tactic.  He has already been successful in getting his $25 million dollars returned to him along with being allowed to rejoin the international banking system.  He will continue to play out this nuclear issue as long as possible in order to extract whatever other goodies the US is willing to throw in for a nuclear freeze and buy more time to develop nuclear weapons program.

When there is no more goodies to be had and his nuclear weapon program has been perfected, his regime will withdraw content with the knowledge that the Kim regime can never be forcibly removed due to their possession of nuclear weapons and if times get tough they know they can always threaten the international community to give them more money and aid.  Why not it has worked every time so far.  In short they have guaranteed regime survival at the expense of the US taxpayer and American creditability.

I also highly recommend you read other views on this matter over at DPRK Studies and One Free Korea.  Also make sure you read this Front Page Magazine piece from notable Korean author and journalist Gordon Cucullu and OFK’s very own Joshua Stanton.  A great read and highly recommended.