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05-31-1999, 03:31 AM
Monday May 31, 2:16 am Eastern Time

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<b><font size="5">ANALYSIS-N.Korea at crossroads after Perry's visit</b></font>

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By Bill Tarrant

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SEOUL, May 31 (Reuters) - U.S. presidential envoy William Perry's landmark visit to

North Korea has put Pyongyang squarely on the horns of a dilemma as it ponders an offer of

major economic and diplomatic benefits in exchange for abandoning its militaristic ambitions.

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On the one hand, Perry apparently offered something North Korea has long hungered for:

diplomatic ties and economic aid from the United States, with whom it remains technically at

war.

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But Perry's offer during talks last week also implied a greater opening to the world by one of the world's most isolated

countries -- something the Stalinist regime could perceive as threatening to its long-term survivability, analysts said.

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``North Korea's at a crossroads,'' said Park Yong-ho at the Institute of National Unification. ``Their first priority is to maintain

(North Korean leader) Kim Jong-il's system. They need economic benefits from the U.S., South Korea and the West, but only

if doesn't endanger their system.''

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Perry did not spell out details of what was on offer.

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He told a news conference on Saturday he had ``explored the possibility of a major expansion in our relations and cooperation,

as part of a process in which the U.S. and allied concerns about missile and nuclear programmes are addressed.''

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South Korean President Kim Dae-jung told Reuters earlier this month that North Korea would be offered security guarantees,

a gradual end to a nearly 50-year U.S. trade embargo, development aid and normalisation of ties with the United States and

Japan.

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The United States, Japan and South Korea -- which are taking a coordinated, ``comprehensive approach'' to North Korea --

have demanded that Pyongyang stop developing and exporting missiles and abandon, once and for all, any nuclear ambitions it

might have.

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Park at the unification institute said North Korea would probably counter with a piecemeal approach of negotiating incremental

changes.

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Yu Suk-rul at the Institute of Foreign Affairs and National Security in Seoul agreed. "I think they've already decided they

cannot accept the comprehensive approach.

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``The status quo is much better, even though it has fewer economic benefits,'' Yu said. ``Once they open up society, it poses a

serious challenge from inside to Kim Jong-il's system.''

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Perry did not meet North Korea's reclusive Kim Jong-il.

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On Friday, shortly after Perry departed, North Korean media said Kim went to the front line of the militarised frontier to

inspect ``enemy positions,'' as if to underline the state of war that has existed on the Korean peninsula the past half-century.

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North Korea's media went back on the offensive after toning down the rhetoric during the Perry visit.

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The official communist party daily Rodong Shimun denounced ``the U.S. imperialists'' in a Sunday editorial for planning

``pre-emptive strikes'' against North Korea.

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``The U.S. Imperialists have already worked out a timetable for a nuclear war against the DPRK (North Korea)...and are

waiting for a chance to train the fuse of a war,'' it said.

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NATO strikes against Yugoslavia are ``a test war, a preliminary war to verify the effectiveness and feasibility'' of the plan.

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The two Koreas remain technically at war because the 1950-53 Korean conflict ended in an armed truce instead of a peace

pact.

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The war pitted U.S.-led United Nations forces against China-backed North Korea. Today, more than two million troops and

thousands of artillery tubes are deployed on either side of the world's most militarised frontier.

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China remains North Korea's chief ally and one of the few friends it has in the world today. Beijing will likely play a key role in

North Korea's response to Perry's overture.

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North Korea's second-ranking leader, Kim Yong-nam, will visit China on Thursday, the highest-level visit in eight years.

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The warmer ties between two of the world's last socialist countries comes at a time of heightened tensions in their relations with

the United States.

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Beijing has reacted angrily to deepening military ties between the United States and Japan, and to their plans for a regional

Theatre Missile Defence umbrella. Washington argues it is needed to protect against a North Korean missile menace.

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North Korea stunned the world by firing a rocket over Japan last August. The U.S. Central Intelligence Agency said

Pyongyang is now the world's leading exporter of ballistic missiles.

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China, too, has been alarmed about the NATO strikes. Its own fears of ``containment'' have been heightened by NATO's

bombing of the Chinese embassy in Belgrade this month, seen in Beijing as a deliberate act of aggression.

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But in a sign that tensions could ease, a team of U.S. experts found no reason to believe at this stage that an underground

building site in North Korea violated a 1994 nuclear agreement between Washington and Pyongyang, the U.S. State

Department said.

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The team returned last week from a visit to the suspected site at Kumchang-ri to make sure it did not break the 1994

agreement, in which North Korea froze its nuclear programmes in return for a promise of nuclear power plants and fuel oil.