Seoul, April 30, 2001

EU Policy Towards the Democratic People's Republic of Korea

On the occasion of the above-mentioned visit to Korea the following pages provide background information on EU policy towards the Democratic People's Republic of Korea.

Supporting international efforts to reduce tensions on the Korean peninsula

The European Union and the Commission strongly support the inter-Korean reconciliation process and international efforts to promote peace and maintain stability on the Korean Peninsula. Thus, the EU is a long-standing advocate of direct dialogue between the two Koreas, and has often urged them to engage in discussions at the highest level, without preconditions. The EU vocation is to play a supporting role in international efforts towards reducing tensions in the Peninsula.

In response to President Kim's policy of engagement, the EU, building on previous EU policy orientations, has adopted a more coordinated approach towards the Korean Peninsula set out in the Council Conclusions of 9 October and 20 November 2000. This envisages expanding our assistance efforts in a measured way linked to North Korea's response to international concerns in regard to progress on inter-Korean reconciliation, non proliferation issues, respect for human rights and economic structural reform in DPRK.

Beginning a dialogue with Pyongyang

Since 1998, the EU has held three rounds of political dialogue with the DPRK at the level of senior officials (Regional Directors), the last one in December 2000 in Pyongyang. This has allowed a frank exchange of views on the full range of areas of concern and mutual interest. In July 1999, the EU set out a coherent roadmap for its future relations with the DPRK in the Council Conclusions on the Korean Peninsula. The EU welcomed the inter-Korean summit of June 2000 and has strongly supported efforts to progress in the inter-Korean reconciliation process. A more co-ordinated approach towards the Korean Peninsula and the DPRK was set out in the Council Conclusions of 9 October and 20 November 2000.

The Stockholm European Council of 23/24 March 2001 agreed to enhance the role of the EU in support of peace, security, and freedom in the Korean Peninsula. The forthcoming visit to Pyongyang and Seoul of PM Persson, Commissioner Patten and HR Solana for talks with both Korean leaders should be seen in this context. The EU would like to encourage the search for a solution bringing lasting peace between the Republic of Korea and the DPRK. This mission is intended to support the momentum created by the Pyongyang Summit.

Continuing our assistance efforts

The EU is among the largest and most consistent donors of assistance to alleviate the humanitarian consequences of the economic crisis in DPRK, and to try to address its root causes. After serious flooding focused the world's attention on this problem, the EU first intervened in 1995 and has provided significant aid every year since then. Over this period, the EU has provided various forms of assistance mainly through Community interventions (food aid, support for agricultural rehabilitation, non-food humanitarian assistance, contribution to KEDO) worth in total around € 280 million.

Food aid : The Commission, via the Food Aid and Food Security Programmes, has been providing significant food aid and rehabilitation assistance to the DPRK to vulnerable people since 1997. Initially a food aid assistance programme, it has increasingly moved from regular food aid to structural food assistance and, in particular, the provision of inputs and technical assistance to enhance agricultural production. Last year, assistance was entirely composed of these programmes, for example, fertilizers, pilot projects on co-operative farms and technical support. In global financial terms, the Commission, over 4 years has provided a total of €168 million, via three channels:

• Bilateral aid: €106.7 million including €6 million implemented by European NGOs and technical assistance monitoring and support;
• World Food Programme: €50 million including €12 million of food aid products distributed by European NGOs and €5 million approved in 2000, but yet to be delivered.;
• NGOs: €11 million via 6 European NGOs, CESVI, Concern, Children's Aid Direct, Action Contre La Faim, German Agro-action, Medecins Sans Frontiere.

Humanitarian assistance: ECHO assistance to North Korea started in 1995, when serious flooding which affected 5.7 million people made the DPRK appeal for the first time for international aid. Since then, €38 million have been provided. The main objective of these humanitarian interventions has been to improve the beneficiaries' access to safe water, sanitation and their personal hygiene as well as to provide drugs and medicines to health institutions. The main direct beneficiaries have been children, adults with key needs, and health institutions.

This assistance is also implemented through European NGOs. Working conditions for NGOs in the DPRK have somewhat improved last year. New, more vulnerable counties have been open to assistance from European NGOs. More monitoring trips are taking place and more beneficiaries are visited in their homes. There has been improvement in access to information for programming as well as closer interaction with Government. Two new NGOs have arrived to this country, Handicap International in March 2001 and the French Triangle to implement our assistance projects. However, room for improvement still remains.

Contribution to KEDO: The Korean Peninsula Energy Development Organisation (KEDO) was founded by the US, Japan and the ROK in 1995 to replace DPRK's existing nuclear facilities (which lent themselves to production of weapons-grade fissile material) with safer, more proliferation-resistant Light-Water Reactors under IAEA supervision. The EU joined, as a member of the Executive Board alongside the three founding members, in 1997, recognising the global importance of maintaining regional security in North-East Asia and also of upholding the international nuclear non-proliferation regime.

According to the terms of its accession agreement, the EU provided a total of € 75 m in funding for the organisation until the end of 2000 - not counting the additional bilateral contributions of a number of EU Member States. Terms of EU membership from 2001 are subject to negotiation within KEDO.

New assistance efforts underway

Assistance will now be increased in a measured way, as indicated in the Council Conclusions of 9 October and 20 November 2000, in the form of technical assistance to support the DPRK `s economic and social development. The Commission sent an expert team to North Korea (mid February 2001) which assessed technical assistance needs and identified areas in which pilot projects could be launched by the Commission relatively soon (mainly market economy training, rehabilitation of the energy sector and rural development) in close co-ordination with Member States and key donors. The project preparation exercise will now be completed and it would mainly involve training activities to enhance understanding of international finance, trade and economic policy formulation and technical advice for the energy sector.

Better market access possibilities

Another way for the EU to contribute to North Korea's economic modernisation efforts and social development has been by adopting additional market access possibilities for North Korean exports to the EU market. The Commission decided last December on a general increase in the Community textile quota on imports of DPRK textile products by 60% (50% in the case of a few products categories) for 2001.

Further market access improvements could be considered in the future, subject to favourable political context and the DPRK's willingness to adapt policies to the needs of European trading partners and investors.