South Korea offers North aid, China wants nuclear talks

SEOUL Tue Aug 31, 2010 1:04pm EDT

North Korean soldiers guard behind a border fence separating the North Korean town of Sinuiju and the Chinese border city of Dandong, March 23, 2010. REUTERS/Jacky Chen

North Korean soldiers guard behind a border fence separating the North Korean town of Sinuiju and the Chinese border city of Dandong, March 23, 2010.

Credit: Reuters/Jacky Chen

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SEOUL (Reuters) - China pressed regional powers on Tuesday to restart talks on ending North Korea's nuclear ambitions, and Seoul offered aid to its destitute neighbor despite a new round of U.S. sanctions against Pyongyang.

In a move that could ease tensions on the peninsula, South Korea made its first large-scale offer of humanitarian aid to the North since the sinking of one of its warships in March.

Seoul offered 10 billion won ($8.4 million) to North Korea after heavy rains in July and August in its northern and eastern provinces forced thousands from their homes and put farmland under water.

Seoul cut off most of its ties with Pyongyang after accusing the North of torpedoing the Cheonan corvette and demanded an apology.

North Korea says it did not carry out the attack, and has told its only major ally China it is committed to denuclearizing the peninsula and wants to resume the aid-for-disarmament talks.

Analysts say the North's willingness to return to talks could be a sign international sanctions are hurting the isolated state, whose battered economy is just 3 percent the size of the South.

China is lobbying neighbors to sign up for renewed talks, and on Tuesday Beijing's nuclear envoy met his Japanese counterpart in Tokyo to discuss a plan to get the six parties back to the negotiating table.

"Both of us agreed to work together to safeguard peace and stability of the Korean Peninsula, meanwhile, we also agreed to work together with the others to push forward the resumption of the six-party talks as soon as possible," Wu Dawei said.

A South Korean diplomatic source said at the weekend that China had proposed a three-stage process to Seoul to restart the talks. He said North Korea and the U.S. should first conduct bilateral talks that could open the way to the broader, six-party negotiations, the source said.

China's regional lobbying, and its courting of secretive Kim Jong-il, highlight the pressures that North Korea -- isolated, poor and with a brace of primitive nuclear bombs -- has brought to bear on the region that is home to the world's second and third biggest economies and a big U.S. military presence.

NEW SANCTIONS

President Barack Obama broadened financial sanctions on North Korea on Monday and froze the U.S. assets of four North Korean citizens and eight firms in part to punish the North for the sinking of the Cheonan.

U.S. officials hope the measures, which target North Korean entities that trade in conventional arms and luxury products and that counterfeit U.S. currency, will also sharpen pressure on the North to abandon its nuclear programmes.

A foreign ministry spokesman in Seoul welcomed the toughened U.S. sanctions. "It can be assessed that the U.S. sanctions regime on North Korea has been completed overall," he said.

The new U.S. sanctions steps aim to target the leadership of the isolated, authoritarian nation, which is preparing for a key party conference that analysts say could nail down succession plans, involving Kim's youngest son, Kim Jong-un.

(Additional reporting by Arshad Mohammed in Washington; editing by Sanjeev Miglani)

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