South Korea: US-ROK, North Korean Nuclear Issue

Keynote Speech by H.E. Ban Ki-moon, Minister of Foreign Affair and Trade at Goldman Sachs' Korea Conference

(Alliance)

The US-ROK alliance has served as a bedrock for peace and prosperity on the Korean Peninsula over the last half century. Now it is entering a stage of historic transformation.

In a new century the environment on the Korean Peninsula is highly complex and sensitive. Against such a backdrop we need a well-coordinated and cautious approach, while demonstrating political leadership and wisdom.

In the post-Cold War era, we are witnessing the drastic changes in the international security environment. In the wake of the September 11 terrorist attacks, the new U.S. military strategy and advanced military technologies require the swift mobility of its forces.

Moreover, Korea's maturing democracy and economic growth have given rise to diverse perspectives, calling for a more balanced partnership in the alliance with the U.S.

Under the leadership of the ROK and U.S. Presidents, our two governments have had the wisdom to put in place a basic framework for the readjustment of the alliance. There has been a change in the stereotypical pattern of our thinking and management of the alliance ties, revitalizing the alliance.

Through such a process of close consultations, our two governments have reached agreement on such complicated issues as the relocation of USFK bases, including the Yongsan garrison, as well as the phased reduction of the USFK.

As our two governments have worked together to resolve important issues over the last two years, we have found that our alliance has grown stronger than ever before.

We have reaffirmed our commitment to the solid alliance ties by pledging to abide by two principles. That is, the combined defence capabilities should be enhanced, and the unique geo-strategic and geo-political situation on the Korean Peninsula should be considered duly in the implementation of the agreements.

The Korean government took another important step with the dispatch of the third largest number of troops to Iraq. This decision was made not only to rehabilitate Iraq but also to bolster our alliance still further.

In his inauguration speech, President Bush has set the basic tone for the pursuit of foreign relations in his second term. The emphasis on closer cooperation with allied and friendly countries in coping with challenges is a welcome sign.

During my visit to Washington D.C. last week, Secretary of State Rice expressed her deep appreciation for what the Korean government has done in the last year in order to solidify our alliance. She agreed with me on the need to widen our dialogue to forge a truly comprehensive partnership between our two countries.

In this regard, we will launch a strategic dialogue at the Vice Minister-Deputy Secretary-level with the aim of working out a blueprint for our alliance.

We will also continue to hold the Security Policy Initiative (SPI) meeting so as to steer our alliance in the best possible direction. By keeping up this cooperative spirit, we will be able to finalize a burden-sharing agreement for the USFK, also finding sound solutions to other crucial issues.

(North Korean Nuclear Issue)

Distinguished Guests!

The North Korean nuclear issue is at the top of our diplomatic agenda. This is the most pressing security challenge facing the ROK and indeed the entire region. I take this chance to reaffirm that the Korean government will make every effort to resolve this issue peacefully and expeditiously.

It was to address this serious issue that the Six-Party Talks process was launched by the countries concerned. Yet, eight months had gone by, since the last round of talks, due to North Korea's reluctance to return to the table.

Then, on February 10, North Korea proclaimed that it would suspend its participation in the Six-Party Talks for an indefinite period of time until certain conditions are met and the right atmosphere is created. North Korea also asserted that it had manufactured nuclear weapons and intends to strengthen its nuclear arsenal.

It is deeply regrettable that North Korea has made such an announcement at this juncture. North Korea's claim regarding its nuclear weapons capability, although more formal in nature as it was included in a Foreign Ministry statement, is not something entirely new. North Korean statement should be taken as rather an unverified unilateral assertion.

Meanwhile, we take note that the door to the Six-Party Talks has not been completely closed. In fact, in its statement North Korea maintains that the denuclearization of the Korean Peninsula remains the goal of Pyongyang.

Moreover, it stresses the resolution of the nuclear issue through dialogue and negotiations. In light of this, the chances are that North Korea's intention is to gain the upper hand before eventually returning to the talks.

I arrived in Washington D.C. for my scheduled visit on the very day that North Korea had issued its statement. It was very timely that I had the chance to engage in close consultations with Vice President Cheney, Secretary Rice and Secretary Rumsfeld, National Security Advisor Hadley, as well as members of Congress and other academia. I also gave an interview with CNN to provide an assessment of the situation and to explain the future course of action.

In Washington I agreed with the U.S. officials, including Secretary of State Dr. Rice, to keep exerting our utmost efforts to resume the talks process without overreacting to North Korea's brinkmanship.

We reaffirmed the basic principle agreed upon by our two Presidents. That is, the North Korean nuclear issue should be resolved through peaceful and diplomatic means within the Six-Party Talks framework. And we also reemphasized that the denuclearization of the Korean Peninsula must remain our common goal.

Upon my return from the U.S., I had a series of telephone consultations with my counterparts in China, Russia and Japan.

There was a convergence of views among all of us on the need for an early resumption of the talks. I expect that China, as the host country to the talks, will also step up its efforts to persuade North Korea to come back to the table.

I am convinced that North Korea's statement should not distract us from pursuing our objectives. That is - the North Korean leadership must make a strategic decision to dismantle its nuclear programs, including uranium enrichment programs, once and for all.

To this end, the ROK will continue to work to convince North Korea of the wisdom of making such a strategic decision for the sake of an early peaceful resolution of this issue.

This decision will accrue all the ensuing benefits to North Korea, including security assurances as well as energy and economic assistance.

With the nuclear issue out of the way, North Korea will be able to look forward to a comprehensive improvement in relations with the international community. For its part, the Korean Government will pursue a more comprehensive plan for cooperation with North Korea.

(U.S.-ROK Economic Relations)

Ladies and Gentlemen,

Let me turn now to the final part of my remarks touching upon cooperation in our economic relations as well as regional and global issues. Korea has forged a prosperous economic partnership with the U.S. In recent years, bilateral trade issues have been well managed through a process of close consultations between our two countries.

Given the huge trade volume, amounting to US$69 billion dollars last year, potential conflicts may well emerge. But we are ready to engage in frank dialogue to smoothly resolve any such disputes.

Moreover, the Korean government is working hard to improve the environment and upgrade Korea's economy to international standards in order to avoid any potential problem with foreign investors. In so doing it is also our aim to make Korea one of the most favorable places for foreign businessmen to do business.

The total amount of U.S. investment in Korea over the last four decades has reached US$32 billion. This accounts for 32% of total foreign investment in Korea, making the U.S. the leading investor in our country.

U.S. industry's active investment in the ROK has also helped to enhance the credibility of Korea in the international financial market.

Another economic challenge relates to the adoption of a more systemic and comprehensive approach to our bilateral trade relations. There have been calls for a system that goes beyond the current micromanagement of pending trade issues.

Early this month our two countries began working-level discussions at the government level on the review of a future FTA. In this regard, we will discuss the possibility of launching official negotiations.

The Korean government firmly believes that a Korea-U.S. FTA will bring far more than great economic benefits and interdependence in a broad strategic framework. In fact, it will in turn serve to sustain a solid alliance in the years ahead.

(Cooperation on Regional and Global Issues)

In defining a vision of a new pattern for a regional cooperation and the East Asian community, we are pursuing a regional architecture that is open and transparent to the U.S.

Korea also shares the U.S.'s firm commitment to increased trade liberalization at the multilateral level. We are working closely with the U.S. in preparation for the upcoming APEC summit in Busan.

I look forward to the summit generating significant momentum for the promotion of world trade and regional economic integration. Not only this, I also hope it will serve to consolidate peace on the Korean Peninsula and Northeast Asia.

(Concluding Remarks)

With the rise of the new generation and rapid spread of information over the Internet in Korea, the Korean government now has much greater opportunities to listen to a variety of public opinions.

Against this backdrop the Korean public have enjoyed fuller participation in foreign policy issues in recent years. The greater access of the public to government affairs has enhanced transparency in government decisions.

In these times of change and evolution, the Korean people in no way doubt the value of our closer alliance. They also hope to develop a more mature partnership of mutual respect.

In this regard, the Korean government will continue to embrace an open approach to its own people, thereby forging national consensus. It is by evolving to meet changes that we can emerge still stronger.

Despite some challenges, our alliance is cemented by common values and deeply rooted strategic interests. For that reason, I am convinced it will continue to play a crucial role in the maintenance of peace and prosperity on the Korean Peninsula.

I am optimistic about the future of our alliance, as we are witnessing increasing exchanges with the U.S. in all fields. Moreover, our two countries are embracing a mature approach in a determination to reach a win-win solution on any critical issue.

The North Korean nuclear issue is a difficult challenge ahead. However, through close consultations and cooperation among the parties concerned, particularly the U.S., I have every reason to believe that we will be able to resolve this issue in a peaceful manner through dialogue.

Thank you very much for your kind attention.

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