On-the-Record Briefing -- ASEAN Regional Forum

QUESTION: Are you going to have meetings tomorrow with -- party talks by the normal six parties and Canada, Malaysia and Australia?

AMBASSADOR HILL: Yeah. Alright. Well, let me just mention, first of all, as you know, this is the -- tomorrow is the ASEAN Regional Forum meeting. This is an annual event. The Secretary did not attend last year and is attending this year. We -- the ASEAN Regional Forum is kind of a set piece event. They'll discuss a lot of various confidence-building measures, usually things like seminars and what not. And that will be in the morning and then we will have a number of bilaterals. She'll be meeting with the Chinese Foreign Minister Li Xhaoxing, Korean Foreign Minister Ban Ki-Moon, Singaporean Foreign Minister George Yeo, Alexander Downer, and Indonesian Foreign Minister Wirajuda. I think she also has a meeting with the Pakistani.

And during the afternoon, there will be a multilateral event, which will deal with Northeast Asia. Now, while we were never hopeful and certainly you can't base policy on hope, there was some reason to believe that the North Koreans might want to come and so we're prepared to hold a six-party informal. Why informal? Because the formal sessions are held by the Chinese in Beijing and this was -- we were prepared to do a six-party informal here in Kuala Lumpur. We invited the North Koreans and they have evidently refused to attend, maintaining their view that they will not attend six-party events unless the sanctions on them are lifted, that is, the financial measures taken against the bank in Macau.

So rather than having a five-party meeting -- six-party minus the North Koreans, the Secretary decided to have a broader discussion and brought in some additional countries, namely, Canada, Australia and the host of the ASEAN meeting, Malaysia. And the purpose is to have a more general discussion of security issues in Northeast Asia. If you look at Southeast Asia, you see ASEAN is working very hard to develop various security structures; Northeast Asia, there's very little. So this is, I think, a first effort, really to sit down with a group of countries, all the players in Northeast Asia -- except for North Korea, which has excluded itself -- plus a couple of other players, including Canada for the first time. And the idea is to have sort of general discussion of what can be done to develop security structures in Northeast Asia. There's -- it's not intended to reach any conclusions. It's intended to be a good discussion. So why don't I stop and go to questions.

QUESTION: Can you walk us through what the Chinese have done (inaudible) Macau Bank?

AMBASSADOR HILL: Yeah. This is in respect to some steps that the Chinese took to protect their own banking system. China is very concerned about -- China generally has an interest in bringing its financial sector sort of up to world standards. After all, they're the, you know, world's biggest exporter at this point and they want to make sure they have a financial sector that meets the challenge of that. So they have tended to be rather strict when they're able to see problems in money laundering and that type of illicit activity. So we have found -- and this did not just begin with the UN Security Council resolution, we found over the months and even years that China does tend to take action when they see illicit activities in their banking sector. So I think what was announced or what was revealed the other day was actually steps that they've taken some months ago.

QUESTION: So this was not (inaudible) not in coordination with (inaudible)?

AMBASSADOR HILL: No, it was not. But I think it is indicative that the Chinese have an interest in protecting their financial sector. And I think it also demonstrates that this is -- the financial sector issues with respect to North Korea are not a bilateral issue with the U.S. I mean, there are a number of countries that are looking at this and China is one of them.

QUESTION: Can I have a follow-up?

AMBASSADOR HILL: Yeah.

QUESTION: (Inaudible) of any way coordination with us?

AMBASSADOR HILL: I think they have tended to cooperate with our bank regulators because they want their banking sector to have a clean bill of health and for that reason they work very closely with our Treasury Department people. And you'd have to check with Treasury to see the degree in which they've coordinated this with them. But my understanding is these measures were well before the UN Security Council resolution.

QUESTION: Were these measures in October or November when the U.S. (inaudible)?

AMBASSADOR HILL: Well, we brought to light some issues that we saw in this Banco Delta Asia. In the context of that, we talked about broader concerns we have. But it was the Chinese regulators who took action with respect to this -- the Bank of China accounts. It was not us.

QUESTION: Has there been any contact at all with the North Koreans? I mean, you're here, you're at the same conference, even a handshake and a (inaudible)?

AMBASSADOR HILL: They just arrived late this afternoon. So we haven't -- there hasn't been a spotting yet. We did invite them to the six-party meeting and we did that through the New York channel.

QUESTION: (Off-mike.)

AMBASSADOR HILL: No. The six-party, meaning the one that they refused to attend.

QUESTION: Did they refuse through the New York channel?

AMBASSADOR HILL: They have actually not gotten back to us, except through public media where they said they will not attend any six-party gatherings as long as there are "sanctions" against them.

QUESTION: From the outside, it seems that China was putting some pressure at least on North Korea to attend some of these talks here and following -- the fact the North Koreans went ahead with the missile launches apart, you know, against China's (inaudible) -- is there any suggestion the idea of the leverage that China was supposed to have over the North Koreans is not perhaps as big as it was thought to be or is China just not applying that leverage as much as they could do?

AMBASSADOR HILL: Well, there's always been a question of -- or an issue of, first of all, how much leverage does it have. Secondly, how much is it applied? Thirdly, what is it going to take to get the North Koreans to respond to that type of leverage? I think the -- you know, the Chinese clearly have a lot of leverage with the North Koreans. China has preferred to use its auspices as the host of the six-party process. And their approach to North Korea in the past has tended to be friendly persuasion.

I think it's fair to say that the Chinese were, frankly, a little concerned at the fact that the North Koreans ignored their requests in respect to the missile launch and appear to have continued to ignore their efforts to get them to attend the six-party talks. I might add, though, that a number of other countries with relations with the North Koreans have also been encouraging them to come to the talks; the North Koreans have consistently refused.

QUESTION: If North Korea won't even meet you on an informal basis, on the sidelines of -- in some respect, what does that tell you about prospects for engaging in the future with North Korea in trying to resolve this?

AMBASSADOR HILL: I would be careful about extrapolating their behavior; one day they'll do one thing, the next day they'll do another. So I'd be careful about drawing any generalizations about it or drawing -- or, you know, expecting that that behavior will continue. It certainly does suggest that for now, they have made a decision that they want to be isolated. And I think it's fair to say that they should be careful what they wish for.

QUESTION: And in your other special (inaudible), have you picked up any indication that they're going to test missiles again, that they're doing it again or --

AMBASSADOR HILL: I mean, there's certainly a number of people who have -- there has been, you know, speculation that they may do that. I'm not aware of any evidence that that's happening.

QUESTION: (Off-mike.)

AMBASSADOR HILL: That's going to be what?

QUESTION: (Off-mike.)

AMBASSADOR HILL: Yeah. As you know, Malaysia is not only head of the ASEAN, but they're also a head of the Organization of Islamic Countries and they're also head of the Non-Aligned Movement. That's sort of a triple-header, so to speak. And they have a lot of discussions with various Islamic countries and the Iranians are here fairly frequently. You would have to ask them how often they're here.

We heard about this today and we did check to see whether the Iranian Foreign Minister will be somehow in attendance or in the vicinity of the ASEAN meetings, and the answer is no. So I think it's -- I think you'd have to ask them. I think it's in respect to their responsibilities in the OIC and bilaterally.

QUESTION: Wouldn't it be a good opportunity to speak to Iran (inaudible) here about the Middle East situation?

AMBASSADOR HILL: I don’t want to get into the Middle East stuff. I've got enough problems. (Laughter.)

QUESTION: I'm going to ask about the Middle East anyway. Can you give us a sense of the concerns that you're hearing from the countries (inaudible) about the situation, particularly countries that (inaudible)?

AMBASSADOR HILL: You know, most of the -- there are not that many ASEAN countries that are Muslim. Malaysia is one of them; Indonesia is another. And to be sure, those countries have issued statements that are keeping with their statuses as Islamic countries and in keeping with their -- and in the case of Malaysia, in keeping with their status as the head of the organization of Islamic countries. But you know, beyond that, you can talk to them, but they -- they're -- things they have said are not surprising at all.

QUESTION: It's not sort of overshadowing (inaudible)?

AMBASSADOR HILL: Not at all. I mean, we're, you know -- I think Asia, like other parts of the world, has a great desire to increase the amount of multilateralism, increase the amount of -- you know, picking up the institutional multilateral architecture. And I think Malaysia, especially in the chair, has been very concerned with making sure this ASEAN Regional Forum is successful, the ARF. For people who follow the ARF, they know that it is challenged by the fact that it is a consensus organization and that often, the activities it engages in are not what we call high-end; that is, if you compare it to various multilateral structures. In Europe, for example, they've not been involved in peace-keeping, they've not monitored elections of any kind. So I think there is a great desire in Asia to try to work on that and try to improve that.

We know that in Northeast Asia, there's even less of this going on, partly because the relations in the region are so strained. And so there is an effort, and we're part of that, to try to increase the amount of multilateral contact. These are, kind of, long-term issues. I mean, they're not crisis-driven discussions.

QUESTION: Is the U.S. disappointed at all about the statement on Burma? It seemed like ASEAN and the U.S. position was -- or ASEAN's position was coming closer to your position in the last few months and it was a little bit watered down than what some people expected.

AMBASSADOR HILL: Well, frankly, I would draw your attention to the Wall Street Journal editorial -- not Wall Street Journal editorial -- I mean, the Wall Street Journal op ed piece done by Foreign Minister Hamid, where he made very clear ASEAN's concern at Burma's behavior. I thought that was a very, very strong statement suggesting that the patience that ASEAN has for their fellow member Burma is pretty much drying up and essentially ASEAN is speaking through its chairman, Foreign Minister Hamid. And if you read the article, it says Burma should be dealt with by the United Nations and, as you know, there is an effort to do more about Burma through the UN. And I think it does reflect a growing frustration in ASEAN where they have clearly tried to engage Burma through what they call the ASEAN way, which I know some people say means no way at all, but in fact what they’re trying to do is work very graciously through a consensus-driven multilateralism and what they’ve found is that they haven’t gotten anywhere with Burma and it’s fair to say there’s a lot of frustration.

QUESTION: Do you think that the strong statements by the U.S. (inaudible) a long time and Europe has made ASEAN think perhaps that their relations with those two, the U.S. and Europe, could be at risk if they don’t stop movement on Burma.

AMBASSADOR HILL: I wouldn’t say relationships are at risk but I think what we have tried to do is to work intensively with ASEAN and it’s not so much a question of making statements, it’s a question of working with them on a common problem, after all, Burma is not just a problem for itself, Burma is a problem for the entire region. Burma used to be a major exporter of various tropical products and now it’s an exporter of disease and refugees. So I think there’s a great deal of concern about Burma’s behavior and we have had intensive dialogue with ASEAN countries through traditional diplomatic channels. We've also engaged China on the subject of Burma, we've engaged India on the subject of Burma. We have made sure that Burma doesn't feel it can kind of pick and choose and play off one country against the other. And frankly, I think Burma's finding that there's an emerging consensus that Burma is way out of line.

Helene.

QUESTION: I just want to make sure I have this one clear. Will you be -- is there any chance that you might be -- one-on-one with the North Koreans on this trip?

AMBASSADOR HILL: Helen, I have trouble predicting the future except when the Red Sox play, but I will tell you that we have zero plans to meet with the North Koreans. We have made it very clear; indeed, we extended a very -- an invitation to them to participate in the six-party meeting which would have been informal, which would have allowed them to express themselves in a multilateral context but they continue to say they approve of, but that they will refuse to participate in.

So we do not have any intention of engaging them bilaterally until they are back in the diplomatic game. And when they are back in the diplomatic game, if they are prepared to be a member of the six-party talks, we're prepared to have as many bilateral meetings as they can stand.

QUESTION: Is that a shift?

AMBASSADOR HILL: No, that's not a shift. That's a threat. No, I mean, it's just -- (Laughter.) No, we are -- in the context of the six-party --

QUESTION: In the context, okay, (inaudible).

AMBASSADOR HILL: In the context and context is figurative, it doesn't mean on the room, it doesn't mean in the building, it just means in the context. But what we are not prepared to do is to allow them to essentially jettison the six-party process, make it moot while they carry out a bilateral negotiation with the U.S. for the purpose of dealing with the multilateral problem. And I've said this before, but it really bears repeating, that at the end of the day, when we get a solution, a number of countries are going to have to come forward and be part of that solution. And those countries happen to be the countries in the six-party process.

We cannot solve North Korea's energy by the U.S. We need South Korea involved in the energy solution. We cannot solve their economic problems by the U.S. We need Japan and China to be involved in that and frankly, Russia also has an important role to play in any energy solution and any dismantlement of their nuclear facilities, because Russians have a lot of experience with that. We need a multilateral process for this. And if they're prepared to continue that, that is, if they're prepared to implement the deal that they agreed to in Beijing -- and this one just didn't agree with us, this is an agreement with all their neighbors. If they're prepared to do that, sure, we are prepared to have bilateral meetings with them. And I did so in the past and I'll do so in the future, but we're just not prepared to let them have bilateral meetings as a substitute for multilateral meetings. So when will I meet them bilaterally? That's kind of up to them.

QUESTION: (Inaudible) on the subject of discussions tomorrow, specific questions of missile firing with North Korea -- will be addressed? And also, why do you -- why is Canada and Australia permitted to participate?

AMBASSADOR HILL: Well, first of all, we entered this discussion without a specific agenda, so the issues that come up will depend on the participants. So if somebody raises the missile launches, and I can assure you somebody will mention the missile launches, that will be discussed. But we do not have an agenda, a written agenda. We are interested in looking at future security issues. One of the future security issues will, of course, be the post-UN Security Council resolution, where we will be looking at issues like counterproliferation. Australia has a great deal of interest and a great deal of experience in counterproliferation. And so we think it's appropriate that they be at this meeting. But I want to stress, this meeting, in and of itself, is not to set up some process, it is to have a serious discussion about serious issues. So it is not a formal process; it's an effort to bring countries together that have something to offer in both in experience and in ideas, so we think Australia has that. And with respect to Canada, Canada has not participated in this kind of effort before, but if you look at a map, you can see that Canada would have an interest in Northeast Asia, and so we welcome to see what Canada, and especially as Canada has a new government, to see what contribution they might make to a discussion of that kind. But we're not setting up a mechanism here, we're not setting up anything that will replace anything else. It's simply -- we're setting up a meeting to have a discussion.

QUESTION: (Inaudible) six-party talks (inaudible) focus?

AMBASSADOR HILL: Well --

QUESTION: So what time limit are you (inaudible)?

AMBASSADOR HILL: Well, we are not having six-party talks because the North Koreans have declined to come to the six-party talks. The discussion that we're having among six-party participants, plus some other countries, is an effort to discuss security issues in Northeast Asia. To be sure, some of those security issues are ones that we might discuss in a six-party forum, but many are not. Many are issues that may go beyond what the six-party process is really doing; that is, implementing the September Beijing statement. So what we're trying to do is have a broad discussion about security issues. And if you look at the imbalance between Northeast Asia, in terms of the security discussions that are carried on there, and Southeast Asia, where there are many security issues discussed, it's really an effort to get Northeast Asia to have a little more fullness of discussion and we'll sort of assess what the discussion was like and we'll figure out where to go from there.

Thank you very much, but I have to get into this funny-looking shirt and go to dinner.

2006/T19-10