U.N. powers agree to draft sanctions on North Korea

UNITED NATIONS (Reuters) - Seven key countries agreed to a draft U.N. resolution on North Korea on Wednesday, ending weeks of wrangling over a plan to expand sanctions against Pyongyang for its recent nuclear test and weapons program.

The draft resolution, penned by the United States and endorsed by the five permanent Security Council members, plus Japan and South Korea, was being discussed at a closed-door meeting of the 15-nation Security Council.

"If all goes well we're expecting a vote on the resolution on Friday," a U.N. diplomat told Reuters on condition of anonymity.

The agreement ended more than two weeks of closed-door negotiations that pitted five powers demanding tough sanctions against Pyongyang for its May nuclear test -- United States, Britain, France, Japan and South Korea -- against Russia and China, which argued against harsh penalties for North Korea.

The draft resolution, obtained by Reuters, "condemns in the strongest terms" North Korea's nuclear test last month and "demands that (it) not conduct any further nuclear test or any launch using ballistic missile technology."

The end result reflected the compromises arrived at to satisfy the objections of China and Russia. Beijing and Moscow had opposed language in earlier drafts requiring countries to inspect North Korea vessels carrying suspicious cargo that might violate a partial U.N. trade and arms embargo.

In the latest version, the Security Council "calls upon" states to inspect such vessels but does not require it. However, the draft resolution would require countries to deny fuel to any suspicious North Korea vessels.

'WATERED DOWN'

The United States had also been pushing for a mandatory expansion of financial sanctions against Pyongyang. But the resolution "calls upon" states not to enter into new financial commitments with North Korea except for humanitarian or development projects.

The resolution also expands the partial arms embargo against Pyongyang to ban the export of all weapons by North Korea but allows Pyongyang to continue purchasing small arms, provided such sales are reported to the United Nations.

The council would also require the North Korea sanctions committee to update its list of companies aiding Pyongyang's nuclear and missile programs within 30 days. There are currently three North Korean firms on the list.

Several diplomats said the latest text, which could undergo further adjustments before it is approved by the full council, was a watered-down version of an initially tough draft resolution aimed at expanding the sanctions imposed on Pyongyang after its first nuclear test in October 2006.

Until recently, those sanctions had been widely ignored and unenforced. The new draft resolution urges countries to implement the 2006 sanctions spelled out in resolution 1718.

Chinese envoy Liu Zhenmin made clear to reporters that Beijing, the nearest North Korea has to a major ally, was satisfied with the draft resolution.

"I hope countries will endorse the text," he said.

With Russia and China on board, Western countries are hoping for a unanimous vote in favor of sanctions that would send a strong signal of international unity.

Council members Vietnam and Libya, however, are seen as potential hurdles to a unanimous vote, Western diplomats say.

(Editing by Eric Beech)