US envoy sees hope of NKorea nuclear deal

BEIJING, Dec 20: The US envoy at talks on dismantling North Korea's nuclear weapons held out the possibility today of agreement on first steps towards that goal, weeks after Pyongyang defiantly staged its first nuclear blast.

Assistant Secretary of State Christopher Hill said US and North Korean negotiators were fleshing out plans to set in motion a joint statement from September 2005 promising North Korea aid and security assurances in return for nuclear disarmament.

''Certainly we are talking about much more than just agreeing on things on paper. We're discussing actual developments on the ground, and for that reason these discussions are not easy,'' Hill told reporters after a third day of talks in Beijing. He added that agreement could come by Friday.

''We'd like to see if we can get an agreement that would constitute a first batch of elements for implementation pursuant to the September agreement.'' Hill's remarks were the first hint of progress in the talksbetween the United States, the two Koreas, Russia, Japan and host China that resumed on Monday after more than a year's break.

They came 10 weeks after North Korea held its first nuclear test, on October 9, drawing regional condemnation and UN sanctions backed even by its patient chief aid-provider, China.

The veteran US negotiator warned differences could still scuttle a deal, particularly North Korean rancour over financial restrictions Washington invoked last year after determining North Korea had counterfeited US cash and laundered illicit earnings.

''Nothing is agreed unless everything is agreed,'' Hill said.

''The North Koreans have always have shown they're pretty tough on these issues.'' Other envoys said North Korea remained far from the other negotiating countries.

''Big gaps remain over basic positions,'' Japan's chief envoy, Kenichiro Sasae, told reporters.

COMING TO UNDERSTANDING?

But movement appeared to have come in the two-way talks between the United States and North Korea -- two countries with a decades-old history of war and mutual suspicion.

''There was a lot of give and take and a lot of questions,'' Hill said of the bilateral talks. ''I think we understood their thinking better on some of these issues. We hope they understood our thinking.'' On Monday, North Korea's chief negotiator Kim Kye-gwan laid out a sweeping set of conditions, including lifting UN sanctions and the US financial curbs -- demands that left Hill disheartened. But the North appears to have taken a more pragmatic tack in subsequent talks.

''The idea that I'd still be here tonight telling you it was useful to continue -- I frankly didn't think I would be saying that,'' Hill said.

Sharp disagreements remain, especially over the financial squeeze. Hill and a US Treasury Department envoy said special talks on that dispute were useful but it was far from settled.

''For this process moving forward to be productive and useful, it's going to have to start focusing very, very closely on the underlying concerns of illicit finance,'' US Treasury official Daniel Glaser told reporters after talks today.

Glaser said those talks may continue in New York in January.

Pyongyang and Washington also face thorny problems on the timing and order of moves, said Hill.

North Korea has in the past demanded economic rewards and political assurances before it disarms, while Washington has pressed Pyongyang to first dismantle its nuclear weapons and open itself to international atomic inspectors.

North Korea has also demanded other countries build it a light-water nuclear reactor before it disarms. It is more difficult to divert fuel in such reactors to weapons development.

China, which has hosted the six-party talks since 2003, wants to begin preparing a statement reflecting the new agreement before talks end on Friday, Hill said.

''It's not easy. It's not a lot of fun, either,'' Hill said.

Reuters