NKorea moves towards implementing nuclear deal

SINGAPORE, June 16 (Reuters) North Korea has invited a delegation of the United Nations nuclear watchdog to visit the country in what could be a first step towards implementing an international agreement intended to curb its nuclear programme.

North Korean news agency KCNA said the head of the communist country's atomic energy department had written to the International Atomic Energy Agency about discussions for verifying and monitoring ''the suspension of the operations of nuclear facilities''.

''A working-level delegation of the IAEA has been invited to visit,'' KCNA wrote in a report monitored in Singapore.

Other nations had hoped the release of North Korean money being held in Macau could lead to shutting down North Korea's ageing nuclear reactor and bringing international inspectors back into the country.

It agreed these actions in exchange for fuel oil aid under an agreement reached on February 13.

The international community wants to discourage North Korea from developing nuclear weapons.

Implementation of the deal had stalled over the Macau funds, but some 20 million dollars in released funds is on the way to North Korea under arrangements made in the last few days.

US envoy Christopher Hill told reporters in the Mongolian capital, Ulan Bator, that the money had been sent to Russia, but had yet to reach a North Korean bank account there due to technical reasons.

North Korea appeared satisfied that the glitch would be resolved.

The KCNA statement said the ''process of de-freezing the funds...has reached its final phase''.

Hill had said he was confident that once it had the funds, North Korea would ''then implement its part of the February agreement.'' OSTRACISED Although the amount was relatively small, the money freeze had in effect ostracised North Korea's reclusive leadership from the international banking system, forcing Pyongyang to use riskier ways of moving money around, such as carrying large bundles of cash.

Undoing the move had proved difficult because banks do not want to be associated with funds that have been deemed to be ''dirty''.

North Korea had said it wanted the money back before closing its Soviet-era Yongbyon reactor and allowing international inspectors back into the country under the February agreement.

Hill said before the KCNA statement that he wanted to meet his counterparts from the six parties to the deal -- North and South Korea, the United States, China, Japan and Russia -- early next month to take the agreement forward.

''I would anticipate the Chinese might want to schedule it in early July, because on the basis of that meeting we would then move on to the second phase of implementing the measures that have been envisioned in the February meeting -- that is the disabling the reactor, the provision of considerable amount of fuel,'' he said.

''So I think we need to get moving on that.'' Hill will visit Beijing, Seoul and Tokyo next week to discuss reconvening the six-party meeting.

''I think what we need to do, what (North Korea) will need to do is to get moving on their own obligations, because, believe me, we have been working on our obligations.'' In Tokyo, Noriyuki Shikata, deputy Foreign Ministry spokesman, said that the KCNA report was still being checked.

''We strongly urge North Korea to implement the first-stage measures as soon as possible now that the (funds) issue is settled,'' the spokesman said. ''If North Korea is taking a forward step, that will be very welcome.'' REUTERS HK RAI1825