U.S. may soon remove N.Korea from blacklist

By Arshad Mohammed and Sue Pleming

WASHINGTON (Reuters) - The United States may soon remove North Korea from a terrorism blacklist to try to salvage nuclear talks with Pyongyang but faces resistance from Japan, a source close to the negotiations on said Friday.

"It's probably going to happen," the source said when asked whether Washington was weighing the removal of North Korea from the U.S. list of state sponsors of terrorism, which imposes a range of sanctions.

An announcement had been expected on Friday but U.S. officials said a decision had not been made. They pointed to a need to get "consensus" among the other four nations involved in the talks with Pyongyang.

Japan, in particular, has reservations.

Asked whether President George W. Bush had signed off on removing North Korea from the State Department's terrorism list, White House spokeswoman Dana Perino said: "No."

"We're continuing to work with our six-party partners but I don't expect anything else today on that," Perino added.

The Bush administration has been scrambling in its final months to save the aid-for-disarmament agreement with secretive and impoverished North Korea that it hoped to claim as a rare foreign policy success.

The drive to revive the deal also comes as North Korea has stepped up efforts to rebuild its nuclear facility at Yongbyon and banned U.N. monitors from the Soviet-era plant -- moves Washington and others say must be reversed.

Under a broad accord struck in 2005 between North Korea, South Korea, China, Japan, Russia and the United States, Pyongyang agreed to abandon all nuclear programs in exchange for potential economic and diplomatic benefits.

Under a subsequent pact, the United States suggested it would remove North Korea from the terrorism list in exchange for Pyongyang providing a "complete and correct" declaration of all of its nuclear programs.

That deal has become snagged by North Korea's reluctance to accept a mechanism allowing the United States or other members of the talks to verify its declaration.

It is also held up by Tokyo's objections to delisting North Korea until the issue of the abduction of Japanese nationals decades ago by North Korean agents is settled.

TALKS WITH JAPAN, OTHERS

U.S. Secretary of State Condoleezza Rice discussed North Korea on Friday with Japan's foreign minister, as well as those from China and South Korea, said her spokesman Sean McCormack, who expected Rice to talk to her Russian counterpart soon.

McCormack refused to be drawn on whether Japan was holding up the delisting, except to repeat the Bush administration's view that the abductions issue must be quickly resolved.