6-Party Talks reconvened in Beijing 18-22 December after 13-month hiatus, but no concrete results. U.S. envoy Christopher Hill offered package of aid and security incentives in exchange for end to plutonium production, but North Korean envoy Kim Kye-gwan refused to discuss any steps towards nuclear dismantlement until U.S. dropped all financial sanctions. Talks expected to resume in early 2007.

No date set for 6-party talks, despite Beijing talks between U.S. negotiator Christopher Hill and NK envoys. Disparate agenda expected; NK seeks easing of economic sanctions, U.S. full nuclear dismantlement. U.S. officials suggested incentives might include bilateral talks, unfreezing of NK bank accounts and perhaps formal treaty to mark end of Korean War. South Korea announced would not join U.S.-led Proliferation Security Initiative; however Seoul supported for first time UN Human Rights Committee resolution 17 November condemning NK’s human rights situation.

Pyongyang launched first nuclear test 9 October, escalating fears of regional instability and forcing U.S. and other powers to confront reality of weaponised North Korea. UN Security Council passed Resolution 1718 14 October, calling on North Korea to end its nuclear program and imposing sanctions. China and South Korea demurred on full slate of sanctions, while Pyongyang said unwilling to return to talks unless U.S. withdraws financial sanctions imposed in September 2005. North agreed return to 6-party talks 31 October, due by year-end, but short-term prospects for settlement dim. World Food Programme warned of humanitarian disaster if food stocks not bolstered before winter.

U.S. announced plans for increased sanctions on North Korea while China opposed them, urging “flexible” approach. Australia, Japan followed U.S. in placing sanctions on North Korean bank accounts and companies. Pyongyang reportedly due to remove fuel rods from Yongbyon reactor in significant boost to plutonium harvesting; reports seen as bid to prod U.S. into bilateral talks and dropping sanctions. Chinese negotiator Wu Dawei visited Seoul to discuss new approach to full 6-party talks after South Korean President Roh and U.S. President Bush agreed “joint comprehensive approach” in Washington, but gave few details of new approach.

Tensions continued to mount on Korean peninsula after July missile tests and speculation North aiming for nuclear test. Joint U.S.-South Korean annual military exercises started 21 August and led to North threat of “pre-emptive action”. North and South troops exchanged fire across border 1 August; no injuries reported.

Tensions rose dramatically on Korean Peninsula after 7 test missiles launched 5 July. Japan and U.S. led outcry: UN Security Council voted unanimously 15 July to require prevention of transfer of missile or WMD items, but did not invoke Chapter VII after China and Russia amended Japanese draft. Pyongyang remained defiant, rejecting resolution, claiming right to self defence and threatening “physical” response. U.S., China, Russia, Japan and South Korea decided to move with “5-party” talks if North does not attend. North-South ministerial talks broke down after North refused to discuss launches; South halted food aid. NK officials refused to join security talks on sidelines of ASEAN regional forum in Malaysia.

U.S. intelligence suggesting NK preparing to test intercontinental ballistic missile caused widespread alarm and strong statements from Washington and Tokyo. U.S. announced it would deploy interceptor missiles in Japan. NK delegate to UN said North wants to negotiate directly with Washington: Pyongyang issued invitation to Assistant Sec. State Hill to visit, but offer quickly rebuffed. Japan’s House of Representatives passed bill allowing economic sanctions if NK fails to help resolve abductions dispute.

Nuclear negotiations remained on hold and North-South engagement suffered setback. Pyongyang stopped testing railway reconnection leading Seoul to reconsider cooperation projects. Previously South President Roh Moo-hyun had stated desire to meet Kim Jong-il with offer of increased economic aid. UN resumed limited food aid ending 6-month dispute with government over monitoring of distribution. North’s FM Paek Nam-sun visited Beijing 30 May..

Nuclear negotiations remained stalled. Representatives from U.S., China, Russia, Japan and South Korea, meeting at academic conference in Tokyo, failed to extract commitment from North to return to 6-party talks. Washington maintained economic sanctions in response to NK money laundering and counterfeiting and unrelated to nuclear issue. Japan increased pressure over abduction issue, with draft legislation mandating sanctions if Pyongyang withholds information on past kidnappings.

Nuclear negotiations remained stalled. Military talks held between North and South, at highest level since Korean War, made little progress. Cabinet-level talks due in April uncertain after Pyongyang protested annual U.S./South Korea military exercises. Significant bilateral meeting held in New York with U.S. administration to explain economic sanctions imposed September 2005. U.S. concerned as NK military reportedly conducted short-range missile tests despite agreed moratorium.