2008. and i think that probably has inflated the figures. i would say in all likelihood as we go forward particularly as the new u.n. security council resolution comes into force as we continue our efforts to chlorinate with china in particular but others in the region, that i would be surprised to see those rates of increase continue and 2009 and beyond. ..

to want to engage again, and any kind of discussions or negotiations? >> i think that at the moment there is no evidence that they are prepared to do that now. i am however, as i indicated earlier of the belief that the eventually will come back to the table. then i think the challenge is to impart on us to insure that we engage with them in a realistic fashion, and that we begin

considering negotiating measures, which will in fact be much more irreversible than some of the measures that have been negotiated with them in the past. now i don't underestimate the difficulty in doing that. it is going to be very difficult indeed, but we need a greater sense of the irreversibility and a greater sense that things that they agree to know they are not going to fall away from in the future. as some of us have indicated, we have no desire nor willingness to pay twice for things that north korea is willing to do. >> so, how do we enforce that kind of the reversibility? >> in four said largely to the negotiating process itself and what we are willing to provide in return, and we will have to see. there is no, there is no magic

process by which you do this. it is all very hard work and i think in this case, it all requires very close coordination with the other affected countries of the region. the u.s. really can't do this on its own. we can be a leader in the process but we very much need the active collaboration of the other countries involved. are allies, our allies, south korea and japan, our partners, china and russia. >> is there any reason to believe that if the leadership mantle passes two kim jong-il's son, that it will result in any kind of a change in the leadership there with respect to decision-making? >> i have no reason to speculate one way or the other on that. as i said earlier, quoting

former secretary of defense, william perry, i think you have to deal with korea as it is, not how it might be in the future. >> is there any information to suggest there might be disagreements within the north korean government regarding their nuclear policy? >> no. >> thank you. >> thank you senator shaheen guss senator corker, i know he has indicated to me he is not going to ask questions so we thank you ambassador bosworth very much. we want to stay in close touch and i know we will and a look forward to chatting with you for a moment. if we could ask the second panel to quickly come up and take their seats so we can have a seamless transition, that would be terrific. i would ask each of the following panelists if they would try to summarize the comments in five minutes or less. your full statement will be

placed into the record as if read in fall and this with the committee will have more chance to be able to explore the previous panelists with you and your own thoughts. [inaudible conversations] we are going to lead off with victor cha and then mr. revere, leon sigal and then nancy lindborg soe evictor if you would begin that would be terrific. >> thank you mr. chairman, senator lugar, members of the committee. it is a pleasure to appear before you again to talk about north korea. i have submitted a statement for the record, which i would like to be part of the record and i want to focus my comments more

on some of the discussion that took place during ambassador bosworth's testimony and in particular some of the questions the committee members torres king. the first was that when the committee asked how the financial measures were that were used in 2005, and they are essentially what we did was the treasury department issued a financial advisory, something called section 311 to u.s. financial institutions to be wary of doing business with a particular bank in macau that was thought to beholding north korean accounts that were dirty. that was a very isolated action but it had the effect of causing many other banks around the world and regulatory agencies to ask, why is the treasury department doing this? when they understood the reason for it dade then under their own initiative started to either freeze north korean accounts or ask these accounts not be held in their banks such that you had

a tremendous ripple effect in the world that greatly impeded north korea's ability to do business. this isn't the average north korean because the average north korean does not have an atm card that they can take money out of a local citibank. this affects largely the leadership. the second thing i would mention with regard to these financial measures is that, when the bush administration did them, they were largely a u.s. action war united states was going to other countries and regulatory agencies in europe and elsewhere asking them to take certain actions. the big difference now is the u.n. security council resolution that calls for the designation of certain entities for financial sanctions makes much more of a multilateral effort and i think it becomes much easier to gain cooperation among other countries regulatory

agencies and banks. the second point that i want to make again addressing some of the questions in the earlier recession is this whole question of the inspection regime. to me, although we don't know everything about the u.n. security council resolution, to me what is most interesting is a strong effort by the administration to develop an inspection regime to counter the proliferation potentially of weapons or fissile material by north korea. this is a very important step and institutionalizing some sort of inspection regime what i think have even more value on the counterproliferation side than the financial measures themselves. uscm the financial measures would be taken after the nuclear test but to ramp up a strong inspection regime and the counterproliferation regime that the chinese with cooperate with would be a very useful thing for the world and for u.s. security

interests. the big question, how north korea reacts to these sorts of things? i think clearly, when the bush administration undertook some of these financial measures, many people argued it led to north korea's first nuclear test and the question arises whether these financial measures will lead north korea to their third nuclear test. i don't think we know the answer to that. we do know that they need to face consequences as president obama's said, for their actions and this appears to be the best way to do it. i would agree with the points that were made earlier about china. i think china is very important on the precious side to get the north koreans to return to the negotiating table. there's all sorts of pressure that is not reported in public trade figures. there is a wealth of interaction that takes place between the military's and the parties of these two countries, between the leaders, individuals and in the military some parties where they can do things and send clear

messages that are affected in terms of persuading the north koreans to come back to the table but it the same time don't look like the chinese are kowtowing to the united states because the chinese never want to be seen as kowtowing to the united states. finally in the few seconds that i have left, while i was part of an administration that took north korea off the terrorism list, i do think that the administration said seriously consider putting them back on the terrorism list. we have had ballistic missile tests, its second nuclear test and most recently the taking of these two american women as detainees in north korea. and, i think that we should do whatever we can, the u.s. congress, the administration to get these two women out of the country because no american women should be imprisoned in north korea. thank you for your time. >> thank you mr. cha. we will get back to you on that.

mr. revere-- revere. >> i am here as somebody who has spent much of the last four years working on the asia-pacific region, much of that on the to korea, china and japan. i'm also here is someone who has been a longtime advocate of diplomacy in north korea and through several u.s. administrations during my career i made the case that diplomacy, dialogue and mutual respect for a lot more likely to yield the results that america sought and to yield that at a more acceptable cost where policy is based on confrontation and i base this judgment on years of studying north korea and on hundreds of hours over some 12 years of negotiating with the north koreans. through this experience i came to understand what motivates the north korean regime, it strengthened its weaknesses. my advocacy of negotiations with pyongyang has always been based

on two principles, the first that north korea's possession of nuclear weapons represents a direct threat to u.s. national security interests and two, that eliminating this threat requires a concerted diplomatic effort and in efforts aimed at determining whether north korea was prepared to make a strategic decision to give up its nuclear weapons ambitions in return for things the united states might be prepared to offer. in the past were many times diplomats including myself had serious reason to believe such an arrangement was possible and today i am disturbed to report that this may no longer be the case. today there are disturbing signs that north korea may finally have made a strategic decision about its nuclear weapons and that decision may be at pyongyang intends to keep its nuclear weapons in the north will seek recognition by the united states in the international community that it is now in nuclear weapons state. i am drawn to this conclusion because of statements officials

have made to me over the last year and to virtually every american visitor to pyongyang. it is also based on the dprk's public utterances and actions with respect to its nuclear weapons capability. i'm delighted to have heard so many references to former secretary of defense perry's comments with respect to dealing with north korea as it is. i accompanied dr. perry on his historic visit and i could not agree with that assessment more for good dealing with north korea as it is we are faced with the following. jetsons the beginning of this year north korea has abrogated the 1991 north-south denuclearization accords, outsit iab instructions and walked out of the six-party talks and begun to restart its nuclear facilities ed pyongyang and is conducted yet another nuclear test and it has done so in contravention of its own formal commitments to denuclearized. the obama administration's response to this is then

measured in, but firm and early on president obama appointed ambassador bosworth, my distinguished colleague, as a special reports and a bit and for anyone who knows ambassador bosworth and his reputation that appointment clearly signal the u.s. intention to deal with the high level and deposited in pragmatic way. many americans to deal with north korea including me were deeply impressed by president obama's commitment to diplomacy and resetting relations with adversaries and as a result we conveyed to our north korean interlocutors in the strongest possible terms in recent months that the arrival of this the administration was an historic opportunity to put the u.s. and the dprk relationship back on track. unfortunately north korea has thus far rejected these overtures. in my long statement which i respectfully request be made part of a formal record i discuss what may be behind pyongyang's actions and many of those points have been made earlier in this hearing but to

summarize it think north korea's recent behavior may have much more to do with its internal agenda than with its external relations. whatever the reason, of pyongyang's actions suggest north korea is seeking to establish a troubling and unacceptable paradigm in relations. where do we go from here? many of the steps the administration has taken so far are right on the market including closer consultations and the other steps mentioned by ambassador bosworth and taking all the steps mentioned by ambassador bosworth will exert clear pressure on north korea, maximize solidarity with their allies and drive home the message to the dprk that the path will lead only to further isolation and suffering. let me also say that i strongly recommend the united states keep the door open for people-to-people, cultural and other changes from north korea. these are important ways of exposing north koreans to the truth and the truth is something

that we can employee at a grated advantage in bringing about future change. let me wrap up my comments by saying it is not too late for north korea to hault this freefall in relations with washington and its neighbors. pyongyang can still choose to accept the l- hand, and the united states is prepared to build a better bilateral relationship with pyongyang based on mutual respect, not hostility and the complete end of the north's nuclear weapons program. in fact those principles used to form the core of the dprk's on negotiating position and i would strongly urge pyongyang to return to those principles. >> thank you very much mr. revere. mr. sigal. >> thank you mr. chairman. >> pull the mic down. >> thank you mr. chairman, senator lugar, members of the committee. you have a written statement, which i would like to enter into

the record. it can be summed up in three gary short points and leave lots of room for questions. first, we do not know many things we need to know about the north's nuclear program, about the way the risch team is working. we do not know what many people assert, which is that the north want to give up its nuclear weapons. the fact is, the more we say they want, it only encourages our allies to fear that we are not trying to get them to give them up through serious negotiations. so, i would say that the only way we can find out what we need to know is sustained, diplomatic give-and-take and we do not know whether the north is ready for that, but we have got to find out. second, with respect to change

inside north korea, collapse is certainly a hope but hope it is not a strategy. it seems to me the only strategy that can bring about much-needed change inside north korea, however gradual and grudging, is sustained impeachment and people-to-people exchanges. like the symphony orchestra that the korean society did, where the car rhiann-- the north korean people were exposed to something that undercut years of north korean propaganda, of hostility to the united states. there was the philharmonic playing and there were tears in the eyes of some of those north koreans in the audience and everybody in north korea was exposed to it on their own television. aidid zen interesting way, however gradual, nothing grant, to bring about change. finally it seems to me the heart of our problem is that despite

all the talk about sanctions and military possibilities and all options remain on the table. the sad fact is that we lack leverage to force the north koreans to do what we want them to. the only way i know to get leverage is through engagement that gets them dependent over time on us, and then if they don't live up to their obligations, those things can be stopped or withdrawn. i know of no other way to get leverage. it is a terrible fact that we are at the mercy, to some extent, of the regime that is hateful, but we have to learn how to deal with it, and a diplomatic strategy seems to me the only one that has a realistic chance of getting anywhere. thank you. >> thank you very much. thanks for the summary.

ms. lindborg, thank you very much. >> thank you chairman kerry, ranking member lugar, distinguished members of the committee. i am pleased to be here today. we are certainly gathering at a time of increased tension and i would like to focus my comments today on a different topic as a representative of the non-governmental organization. i have submitted, for the record and i will try to summarize it in a few key points. the first is that there is an ongoing continuously engagements with u.s. non-governmental organizations on meeting critical humanitarian needs within the dprk. i have been involved in working on these issues since the emergence of the serious famine in the mid 90's, when my organization, mercy corps, responded to those very critical needs. there have been a handful,

perhaps a dozen of ngo's that gestating keat since then working on food security, health, water sanitation programs in sponsoring delegations and exchanges that work on technical, understanding improved, understanding between our peoples. this decade plus of experience have enabled us to understand the realities, the constraints and opportunities to how we can work together, how we can understand technical opportunities for improving the lives of the north koreans and improving mutual understanding. since the thaman of the mid 90s or estimates of those who died range from 280,000 to more than 2 million the acute famine has definitely subsided however chronic food shortages remain in the u.n. estimated as of november of last year that there were still approximately 1.8 million metric ton food shortfall, which would lead

8.7 million of the most vulnerable without adequate food intake and nutrition. it is not famine conditions but it is chronic malnutrition so the need remains is my second point. my third point that i would like to highlight is a brief description of the usaid supported food program that recently and it. this was a groundbreaking program that shows us the the way of how we can constructively engage um meeting humanitarian needs that we understand exist. in 2008 u.s. aid negotiated a protocol with the dprk government in which there would be provision from usaid, 500,000 metric tons of american food. this foreign the thousand went to the world food program and 100,000 went through a consortium of five ngo. we were joined by world vision, global resourced services,

samaritans person christian children's fund. all five broad more than a decade of experience in providing humanitarian assistance to all-- bikram breaking aspect of this program was that the agreed upon protocol between the two governments served as the basis for the ngo's negotiated the agreement without counterparts in the dprk. this enabled us to a more accountable way than ever before identified the need. we identified 900,000 children, elderly, pregnant and lactating women in the two provinces of our designated area as the beneficiaries of the food. we were able to indicate at all points of the distribution who the donor was in people were clear that the food was a gift of the american people. we had significant levels of access from the port to the warehouses to the institutions including household visits and we were able to field a team of

16 food monetarist in country for the entire nine months of the program. most importantly this program serves how we can constructively work with their north korean counterparts to develop and deliver a program that begins to meet international standards of delivery based on needs that we agree upon and an approach would jointly implement. as i noted in my testimony regrettably this program was ended early at the request of the north korean government on march 31st. however all five of the participating ngo's as well as our ngo colleagues continue our work, meeting humanitarian needs within north korea of, still focused on the real needs around food security, health, water sanitation. we all believe humanitarian engagement is vital to maintain. >> political tensions between the u.s. and tpr governments remain well known. humanitarian assistance has been

one of the few areas of continuous positive steps forward throughout the last decade. we believe these humanitarian programs meet critical of human needs and the best of the american people maintain open lines of communication with the north korean people. thank you very much. >> thank you all very much. mr. sigal, when kim jong-il gets his debris fun with the americans are saying about him today, and they report that, this guy named sigal went before the relations committee and said all they have to do is get some leverage on them, and then make them dependent, wouldn't they sort of have gained that out? is in that one of the reasons why they are very content to remain isolated and not be dependent? they went the opposite way when they were offered it a little way back. >> that may be but he has promised his people not just a

strong country but a prosperous one by 2012. he can't do that on his own. the only way he can do that is with a political accommodation with us, south korea and japan that allows them to reallocate internal resources, get aid and investment from the outside. if he wants to give up on prosperity, i think that is trouble and i think there is no sign he has changed that few. the rhetoric remains the same so at some point i think he will come and want to deal with us. i also think he needs us for his security. he did not want to be dependent on china. his father did not want to be dependent on china. that is why they reached out to us that when. i think those fundamentals don't change. north carillo lives in a dangerous neighborhood. if they cantor in the former enemies into friends it is much

safer, so i think those things remain in those things ultimately will make him dependent on us. >> why do you think he has gone about it the way he has? >> i don't know. i think it is possible to see what we have as a man who is trying to force us to be his friend. does not trust us, as reasonable grounds for not always trusting us, much weaker country, and a korean tradition were for centuries korean leaders have made deals with the key neighbors rather than standing up to them. what his father did and what he did partly to legitimation their rule is, we are standing up to all the great powers. that is very bad if he chooses to do it just with weapons but

as colin powell put it very well, you can't eat plutonium. if he chooses simply to stand up to the other powers, simply to go for strength and not for prosperity, that is not a very good solution and it is certainly not a good solution for his successor, whenever that person takes power down the road. so kim jong-il needs to move. >> any of you can respond to this question. is there any danger at all that going back to the table, in pursuing this the other route, which incidentally i think you have to do because i don't think you have many choices but what is the danger with respect to the reward of that argument? >> clearly what we want to do is reward good behavior, and you only do things where, as i suggested with one kind of series of steps, if you only do

things when they do things that you want them to and you structure the deals that way. the fact is, we did not always do that and that is a sad fact. north korean behavior is inexcusable. what they are doing now, i don't have to tell you is harmful to them, harmful to us, above all harmful to our alliance relationships down the road, which is a very important reason why we have to get back to the negotiating table and see what we can get. >> the flip side to that question mr. cha goes to your proposal with respect to redesignating them as a terrorist country. first of all, are there not specific legal standards that apply to that designation and do not the steps taken fallout side of them, but equally importantly , wouldn't that designio