North Korea accuses United States of hostility, lies

UNITED NATIONS (Reuters) - An external audit of U.N. funds in North Korea is a hostile maneuver by the United States, Pyongyang said in a letter to U.N. Secretary-General Ban Ki-moon circulated on Thursday.

North Korean U.N. Ambassador Pak Gil Yon also accused the United States of having "dirty" political motives and fabricating lies by suggesting Pyongyang might have misused funds from the U.N. Development Program for the development of nuclear weapons.

"The allegations of the United States are sheer fiction aimed at politicizing international aid to the Democratic People's Republic of Korea," Pak said in the letter, which was also sent to the 15 U.N. Security Council members.

"We cannot doubt that the motive and purpose of the audit are strictly in line with the hostile maneuvers of the United States against the Democratic People's Republic of Korea," Pak said.

Late last month, the 36-member board of the U.N. Development Program, which includes the United States and North Korea, called for an audit and delayed any new programs for North Korea until the review was complete and the agency puts forward proposals in March.

The board's move came after Mark Wallace, the U.S. envoy for U.N. financial management, accused the U.N. Development Program of violating rules by hiring North Korean government officials to carry out its work and by paying salaries in cash through the government.

The program has already revamped its operation in North Korea to make sure Pyongyang does not hire agency staff. The agency's projects are mainly training for food management and other tasks and cost about $4 million.

Pak said the program's aid projects in North Korea were carried out in a fair and transparent way and therefore Pyongyang did "not mind whether the external audit is being done or not."

But he said if the audit "is to serve the attempt by the United States to politicize international aid to the Democratic People's Republic of Korea, we will not tolerate it and the consequences will be severe."

The World Food Program and UNICEF, the U.N. Children's Fund, both headed by Americans, operate under similar restrictions in North Korea and have said they have no plans to change their methods.

The secretive isolated state stunned the world by testing a nuclear device in October. But earlier this month North Korea agreed to freeze the reactor at the heart of its nuclear program and allow international inspections of the site.

Wallace had voiced concerns that funds had been used by North Korea for "its own illicit purposes."