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energy supplies and technical aid. Both the US and Japan further<br />

agreed to normalize relations with North Korea. Moreover, “The<br />

directly related parties will negotiate a permanent peace regime on the<br />

Korean Peninsula at an appropriate separate forum.” 379<br />

At the first session of the fifth round of six-party talks convened<br />

in Beijing from November 9 to 11, the parties reaffirmed that they<br />

would fully implement the September agreement in accordance with<br />

the principle “commitment-for-commitment, action-for-action” in<br />

order to accomplish soon a verifiable denuclearization of the Korean<br />

peninsula and lasting peace and stability in the region. However,<br />

North Korea delayed implementation of the September 19 agreement,<br />

first due to the demand for a light-water reactor and then for the<br />

request to remove financial sanctions that the US imposed in<br />

September on North Korea’s account in the Macau-based Banco Delta<br />

Asia (BDA) due to its alleged money laundering and counterfeiting of<br />

US currency. In particular, the last issue was a major shock for the<br />

North Korean leadership; if the sanctions were not removed, no new<br />

six-party talks would be held. The US claimed that the sanctions were<br />

unrelated to the six-party talks but had to do with implementing<br />

American law. For North Korea, the sanctions were not only harmful<br />

for the government but also hindered business transactions, infringed<br />

on sovereignty and contributed to the failure to implement the September<br />

19 agreement.<br />

Feeling insulted and ignored, on July 4, 2006, North Korea<br />

launched seven short-, medium- and long-distance missiles. Subse-<br />

379_ Jonsson, op. cit., pp. 85, 86, 87, 91-2, 259; Lee, op. cit., May 2, 2007, p. 3. Original<br />

quotation marks.<br />

Expanding Relations but Continuing Tension since 2000<br />

501

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