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Cablegate: Seoul - Press Bulletin; November 23, 2009

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UNCLAS SECTION 01 OF 06 SEOUL 001839

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E.O. 12958: N/A
TAGS: PREL PGOV MARR ECON KPAO KS US
SUBJECT: SEOUL - PRESS BULLETIN; November 23, 2009

TOP HEADLINES
-------------

Chosun Ilbo
ROKG Seeks to Move International Middle Schools and Foreign Language
High Schools to Sejong City

JoongAng Ilbo
Rival Parties Agree on Administrative District Reform

Dong-a Ilbo, Hankyoreh Shinmun, Seoul Shinmun
Contentious Four-River Restoration Project Starts; Local Government
Heads Affiliated with Opposition Democratic Party (DP) Attend
Groundbreaking Ceremony against DP's Policy

Hankook Ilbo
Survey: 76 out of 147 Ruling Grand National Party (GNP) Lawmakers
Polled Favor Revising Sejong City Plan, while 39 Lawmakers Favor
Maintaining Original Plan or,
if Necessary, Introducing "Plus Alpha"
(additional measures to make Sejong city more self-sufficient)

Segye Ilbo
Korea Development Institute (KDI) Calls on ROKG to Implement an
"Exit Strategy" to Head off Adverse Effects
of Protracted Stimulus Policies


DOMESTIC DEVELOPMENTS
---------------------

According to a diplomatic source in Beijing, Chinese Vice President
Xi Jinping will visit the ROK from Dec. 17-19 at the ROKG's
invitation. Xi is considered the most likely candidate for China's
next top leadership. (All)

"Two-faced North Korea:" Pyongyang recently suggested that the two
Koreas hold working-level talks to discuss resuming the suspended
tours to Mt. Kumgang, while criticizing the ROKG through various
media outlets. (Dong-a)

The ROKG is likely to respond to the North Korean proposal following
U.S. Special Representative for North Korea Policy Stephen
Bosworth's Dec. 8 visit to North Korea. (Dong-a)


International News
------------------

On Nov. 20, the U.S. Senate unanimously approved Robert King as
Special Envoy for North Korean Human Rights. (Chosun, Seoul)

Three U.S. experts on Korean Peninsula affairs, including Jack
Pritchard, president of the Korea Economic Institute, and Scott
Snyder, director of the Asia Foundation's Center for U.S.-Korea
Policy, visited North Korea on Nov. 21. They will stay in Pyongyang
until Nov. 24. (Dong-a, Seoul, All TVs)

A senior State Department official said on Nov. 20 that the U.S.
agreed to direct talks with North Korea due to a clear sign from
Pyongyang that it plans to return to the Six-Party Talks. (Hankook,
Hankyoreh, Segye, Seoul, all TVs)


MEDIA ANALYSIS
--------------

-N. Korea
---------
Most ROK media on Saturday (Nov. 21) carried reports quoting a State
Department official as saying that Special Representative for North
Korea Policy Stephen Bosworth will stay in Pyongyang for one and a
half days, leading a delegation of four or five interagency

SEOUL 00001839 002 OF 006


officials, including Special Envoy for the Six-Party Talks Sung
Kim.

Left-leaning Hankyoreh Shinmun commented that the size and the
length of Ambassador Bosworth's delegation are relatively "small and
simple," despite the great attention attracted to the visit. The
article's sub-headline read, "This Four-or Five-Member Delegation is
Almost Half the Level of Previous Visits to N. Korea; It May Show
Washington's Determination that This Visit Is Not For Substantial
Negotiations but for Discussing Resuming Six-Party Talks."

Most ROK media today and over the weekend covered Nov. 19 press
remarks by Secretary of State Hillary Clinton, in which she said:
"We are going to go with a very clear message that there are
significant benefits to North Korea if they recommit to the
verifiable, irreversible denuclearization of the Korean Peninsula.
The U.S. would explore some of the issues which they have raised
continually with us over the years: namely, normalization of
relations, a peace treaty instead of an armistice, and economic
development assistance."

Conservative Chosun Ilbo editorialized today: "There will be no one
who does not want (to see) North Korea to give up its nuclear
ambitions and a peace treaty to be signed on the Korean Peninsula to
permanently remove the dangers of war from the Peninsula. However,
should the envisioned peace treaty include the withdrawal of USFK,
we may face a situation where the USFK, the most effective deterrent
against war, vanishes in return for a peace treaty, which could be
reduced to a mere scrap of paper at any time. ... Even if
discussions start on a peace treaty after progress is made in
nuclear negotiations with North Korea, we must be assured that the
ROK will be a key party to the peace treaty."

Moderate Hankook Ilbo observed in an editorial: "The question is how
North Korea will respond, but recent developments seem positive. Ri
Gun, Director General of American Affairs at North Korea's Foreign
Ministry, has reportedly clearly hinted during his recent visit to
the U.S. that the North will return to the Six-Party Talks.
Furthermore, China is strongly pressing North Korea to rejoin the
Six-Party Talks through various channels."

A senior State Department official was widely quoted today as saying
on Nov. 20 that the U.S. agreed to direct talks with North Korea due
to a clear sign from Pyongyang that it plans to return to the
Six-Party Talks.


OPINIONS/EDITORIALS
--------------------

OBAMA'S VISIT TO SEOUL LEAVES SOMETHING TO BE DESIRED
(JoongAng Ilbo, November 23, 2009, Page 34; Excerpts)

By Editorial Writer Kim Jin

President Obama's four-day three-night visit to China was full of
events. He met with his half-brother, Mark Ndesanjo, whose wife is
Chinese. Knowing that China and the White House are in-laws, people
probably thought, "Human races will be more mixed." President Obama
climbed the Great Wall. While looking at the huge structure that is
reportedly seen even from the moon, people must have keenly felt the
high spirit of the Chinese (people.). In Shanghai, President Obama
had a town hall meeting with ambitious college students. He talked
with a future China.

President Obama's 20-hour stay in the ROK was successful to some
degree. During the meeting and the press conference, the two
leaders praised the ROK-U.S. alliance. It was a "splendid
restoration of friendship" strained under the previous Kim Dae-jung
and Roh Moo-hyun Administrations. Big news of a U.S. Presidential
envoy's visit to Pyongyang also came out.

However, President Obama's visit left something to be desired. His
stay in the ROK was not only short but also prosaic. President

SEOUL 00001839 003 OF 006


Obama arrived by plane at night and had a good sleep. The next day,
he met with the ROK President and had lunch together. During his
20-hour stay, all the ordinary people he met were the employees of
the U.S. Embassy in Seoul and U.S. troops in the ROK. After meeting
U.S. troops, he hurried back home. He said that his daughter's play
was scheduled for the following day. His visit to Seoul wrapped up
like that.

The ROK and China are, of course, different. China is in the G2
with the U.S., but the ROK just joined the ranks of the G20. The
ROK does not have either Ndesanjo or the Great Wall. Still, the ROK
is special. The ROK is the U.S.'s 60-year ally, and President Obama
made his first trip to the nation. Furthermore, Obama is more
popular in the ROK than in any other nation. If President Obama had
guessed Koreans' affection for him, he should have stood in front of
Koreans, whether it was a university or an orphanage. How
impressive it would have been if he had responded in his own way to
Korean teenagers' questions, such as "How did you overcome
difficulties as an African American?" and "Why did you decide to go
to the slums in Chicago, even though you had a promising future
after graduating from a prestigious university?" The same goes for
the North Korean issue. If he had entered the demilitarized zone
(DMZ) and declared, "If North Korea abandons its nuclear programs
and tears down the walls, we will help you," how eloquent it would
have been. In 1993, then-President Clinton visited the "Bridge of
No Return" at the truce village of Panmunjom. In 2002,
then-President Bush gave a speech at Dorasan Station, which was
broadcast live.

Why did President Obama's visit leave much to be desired? Was it
attributable to lack of diplomatic skills on the part of the ROK or
due to Washington's lack of consideration for the ROK? If the
latter is true, is the U.S. displeased about the ROK's troop
withdrawal from Afghanistan or its "passive" troop redeployment? Is
the affection that Koreans feel for Obama one-sided love?


NO RENEGOTIATION OF THE FTA
(JoongAng Ilbo, November 21, 2009, Page 38)

President Lee Myung-bak said he'd be willing to talk about
automobiles in the Korea-U.S. Free Trade Agreement if there are any
problems there. That's not surprising. But Lee's words left room
for some misunderstanding and some foreign news agencies reported
that Korea had taken a 180-degree turn on its previous stance. The
Democratic Party and other opposition sectors criticized the
government for giving in to the U.S. request for renegotiations.
But Lee more than likely referred to additional negotiations, which
would entail revising supplementary documents through extra
discussions.

The (text of the) Korea-U.S. FTA runs over a thousand pages.
Renegotiating only the automobiles part (of the agreement) would
break the balance of benefits for both sides. And it's difficult to
find any precedent where countries fixed their already-agreed-upon
FTA pacts. And once the renegotiation is under way, Korea could
raise complaints on intellectual property rights and medicine. When
the balance that was achieved through a packaged settlement is
endangered, then the Korea-U.S. FTA will be all but wiped out.
Renegotiation is not right, nor is it possible.

The U.S. discontent with the automobiles section is understandable.
Last year, the United States sold 8,864 vehicles in Korea, but
Korea's Hyundai-Kia Motors sold about 53,000 cars in the U.S. in
October alone. Of course, it's not all because of systematic
problems, such as tariffs. The essence of the problem is that the
U.S. cars are no longer competitive. It's easy to see that when you
consider that the European Union exports 50,000 cars a year to Korea
under the same conditions. The United States has never presented
any benchmark for review of the FTA or made any specific requests.
Revision to the taxation on cars with large engine displacements and
other U.S. demands are already included in the current agreement.
But U.S. auto unions and some members of Congress are constantly
raising issue with the deal. They keep saying they won't accept the

SEOUL 00001839 004 OF 006


Korea-U.S. FTA in its current form.

When Lee said he was ready to listen, he may have tried to quell any
doubts surrounding the agreement. Fortunately, U.S. President
Barack Obama responded that he'd acquired a tool to persuade
Congress once he returns home.

Foreign Minister Yu Myung-hwan was busy fending off speculation
about renegotiation, saying it would never take place. But it's
time the two countries got past defensive postures and tried to
solve problems creatively and diplomatically. As we witnessed
during the candlelight vigils last year, any Korea-U.S. deal can be
incendiary. It'd be wise to leave the agreement itself untouched
and then revise annexed documents, exchange side letters or reach
pacts between industries in order to resolve the automobile issue.
And both sides must never insert any toxic clause that could provoke
the people of their own countries.

(This is a translation provided by the newspaper, and it is
identical to the Korean version.)


LEE'S FTA COMMENTS CREATE NEEDLESS CONFUSION
(Chosun Ilbo, November 23, 2009, Page 39)

In a press conference on Thursday with U.S. President Barack Obama,
President Lee Myung-bak said, "If there are any problems in the
automobile sector... then we are ready to resolve this issue." The
comment came in response to a question by an American journalist who
asked if Lee was willing to open up Korea's automotive market
further to expedite ratification of the bilateral free trade
agreement. The U.S. side probably interpreted Lee's comments as
signaling his willingness to either re-negotiate the FTA or hold
additional talks.

But faced with questions from lawmakers on Friday, Foreign Minister
Yu Myung-hwan said the President's comments did not signify a
re-negotiation or additional talks, while Trade Minister Kim
Jong-hoon said they meant that Korea would "listen to what the U.S.
has to say." In other words, there is no change in the government's
stance that the FTA stands as signed by both sides in 2007.

Two-and-a-half years later, the FTA has yet to be ratified by either
side, due to opposition by the U.S. Senate. U.S. discontent over
the trade imbalance with Korea in the automotive sector played a
major role in Washington's lack of action. Last year, Korea
exported around 598,000 cars to the U.S. worth US$7.32 billion. But
imports of American-made cars to Korea totaled just 8,864 vehicles
worth $220 million. At the crux of the matter is the fact that this
imbalance is not the result of a systematic discrimination against
American cars by the Korean government, but that Korean consumers
find American cars inferior to European and Japanese ones in terms
of fuel efficiency, design, performance and comfort. U.S. pressure
forced Korea's automotive market wide open, but the benefits of
increased access have gone to the Japanese and Germans instead.

A government official explained that Lee's comments expressed his
willingness to listen to U.S. complaints and explain Korea's
position, in order to end the continued delays. But the bottom line
is that the comments have generated unnecessary confusion.

Such comments can be thrown out as the last card if all else fails,
but such impromptu comments sap the (government's) negotiating
power. Korea's national interests suffered in the five years of the
previous administration from impromptu comments by the former
President. It is time we went beyond such mistakes. The
President's aides have made a big mistake in allowing this blunder
to happen.

(This is a translation provided by the newspaper, and it is
identical to the Korean version.)


IS THE U.S. MOVING TOWARD A PEACE TREATY WITH N. KOREA?

SEOUL 00001839 005 OF 006


(Chosun Ilbo, November 23, 2009, Page 39

U.S. Secretary of State Hillary Clinton told reporters at a press
conference on Thursday, "We are going to go with a very clear
message that there are significant benefits to North Korea if they
recommit to the verifiable, irreversible denuclearization of the
Korean Peninsula." She added that the U.S. "would explore some of
the issues which they have raised continually with us over the
years; namely, normalization of relations, a peace treaty instead of
an armistice, (and) economic development assistance." "All of that
would be open for discussion," she said. In the September 19 Joint
Statement of 2005 and the February 13 Agreement of 2007, the two
Koreas, the U.S., China, Japan and Russia agreed to hold separate
talks over a permanent peace treaty on the Korean Peninsula, but
this is the first time for a top U.S. diplomat to mention the peace
treaty publicly.

Until now, North Korea has been demanding a peace treaty as a
precondition to giving up its nuclear weapons program. In a recent
meeting with Chinese Premier Wen Jiabao, North Korean leader Kim
Jong-il said the nuclear standoff could end only if the U.S.
government abandons its "hostile" policy toward the North. By that
he means the signing of a peace treaty that will replace the
armistice, the dissolution of the South Korea-U.S. alliance or
similar measures and the departure of American troops on the
peninsula. Regardless of whether North Korea really wants U.S.
troops to leave, it could view the evacuation of American forces as
the greatest threat to South Korea and seek to use that weakness to
its benefit. The reason North Korea has been so adamant about a
peace treaty is because the signatories of the armistice were China
and the U.S. and the participation of those two superpowers in
signing a peace treaty would play into Pyongyang's strategy of
excluding South Korea from the negotiating table.

There will be no one who does not want (to see) North Korea to give
up its nuclear ambitions and a peace treaty to be signed on the
Korean Peninsula to permanently remove the dangers of war from the
Peninsula. However, should the envisioned peace treaty include the
withdrawal of USFK, we may face a situation where the USFK, the most
effective deterrent against war, vanishes in return for a peace
treaty, which could be reduced to a mere scrap of paper at any time.
South Korean and U.S. officials are fully aware of this. But if
North Korea demands a peace treaty and the departure of U.S. troops
in exchange for abandoning its nuclear program, it is difficult to
gauge Washington's response, whose first priority is to get rid of
nuclear threats against the U.S. From that standpoint, Clinton's
"peace treaty" comment deserves a closer look.

Even if discussions start on a peace treaty after progress is made
in nuclear negotiations with North Korea, we must be assured that
the ROK will be a key party to the peace treaty. The ROK accounts
for two-thirds of the population of the Korean Peninsula, and it
makes no sense to discuss any treaty of that kind which would
exclude the main economic force in the region. The issue of U.S.
troop presence can be discussed later after a watertight security
framework is created in Northeast Asia, similar to the common
security system shared by European countries.

There is no chance that Washington and Pyongyang will sign a peace
treaty any time soon. But Clinton's comments have made it clear that
the U.S. could simultaneously discuss the North Korean nuclear
problem and a peace treaty with the North. South Korea should not
miss this critical point.

(This is a translation provided by the newspaper, and it is
identical to the Korean version.)


GROWING EXPECTATIONS FOR U.S.-N. KOREAN BILATERAL TALKS
(Hankook Ilbo, November 23, page 31)

U.S. Special Representative for North Korea Policy Stephen
Bosworth's December 8 visit to North Korea creates a bright prospect
for U.S.-North Korea bilateral talks. The North has reportedly

SEOUL 00001839 006 OF 006


hinted at the possibility of returning to the Six-Party Talks. The
U.S. has expressed willingness to discuss normalization of relations
with North Korea and a Korean peninsula peace treaty. These
indicate a favorable atmosphere (for U.S.-North Korea relations.) A
ray of hope is shining on the Korean Peninsula where a dark cloud
has hung.

It seems that the U.S. does not want to stir up too many
expectations from the North because the number of Ambassador
Bosworth's delegation will not exceed 5-6 and he will stay in
Pyongyang just for one and a half days. In addition, it is too
early to be optimistic since North Korea has often disappointingly
made capricious moves. However, U.S. Secretary of State Hillary
Clinton made significant remarks during a November 19 press
conference that if North Korea seeks denuclearization in a
verifiable way, the U.S. may consider normalization of diplomatic
relations with the North, a peace treaty and economic assistance."
She used a flexible expression, "if North Korea seeks
denuclearization", instead of strongly demanding that the North
should be committed to nuclear dismantlement first.

Secretary Clinton made it clear that Ambassador Bosworth will visit
North Korea with this message. During his trip to Asia, including
the ROK, President Obama delivered similar messages. The question
is how North Korea will respond, but recent developments seem
positive. Ri Gun, Director General of American Affairs at North
Korea's Foreign Ministry, has reportedly clearly hinted during his
recent visit to the U.S. that the North will return to the Six-Party
Talks. Furthermore, China is strongly pressing North Korea to
rejoin the Six-Party Talks through various channels.

When Hyundai Chairwoman Hyun Jeong-eun recently visited Mt. Kumgang,
North Korea suggested to the ROK that both countries hold a meeting
to resume tours to Mt. Kumgang and Kaesong. This shows that North
Korea is very willing to improve relations with the ROK and the U.S.
The North may be well aware that it would be hard to normalize
inter-Korean cooperation such as the resumption of Mt. Kumgang tour
project without making progress on the North Korean nuclear issue.
The ROKG should actively respond to the North's offer in order not
to hamper overall progress while thoroughly preparing for the
outcome of U.S.-North Korea bilateral talks.


STEPHENS

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