S. Korea 'may delay aid to North'

South Korea is considering delaying rice aid to North Korea after it failed to meet a key deadline to shut down a nuclear reactor, officials say. Seoul had said aid would resume whether or not Pyongyang met the deadline, but it is now reviewing this, reports say.

Russia, meanwhile, said the missed deadline was down to failure by the US to resolve a financial dispute. The row, over frozen North Korea accounts, has stalled implementation of the nuclear deal for several weeks. Under the landmark 13 February deal, North Korea agreed to "shut down and seal" its Yongbyon reactor within 60 days in return for aid. But it linked progress on the deal to the return of $25m (o13m) of its money frozen in a Macau bank.

The US says the money is now available to North Korea, but there has been no confirmation of this from Pyongyang and Saturday's deadline came and went with no official comment from the North. Its dialogue partners - the US, China, Russia, South Korea and Japan - appear to be giving North Korea a few more days to comply.

N. KOREA NUCLEAR DEAL (a) N Korea to 'shut down and seal' Yongbyon reactor, then disable all nuclear facilities (b) In return, will be given 1m tonnes of heavy fuel oil (c) N Korea to invite IAEA back to monitor deal (d)Under earlier 2005 deal, N Korea agreed to end nuclear programme and return to non-proliferation treaty (e) N Korea's demand for light water reactor to be discussed at "appropriate time" South Korean officials met on Sunday to discuss their next steps.

The two Koreas are due to begin economic talks on Wednesday, at which the resumption of rice shipments is to be discussed. North Korea asked Seoul for 400,000 tonnes of rice last month. South Korea, a major food donor to the impoverished North, suspended shipments after Pyongyang's missile tests in July 2006, but agreed to resume them after the February deal.

Unnamed officials told South Korean media that the talks were likely to go ahead, but the government was undecided over whether to resume rice aid. "We can't just ignore and do nothing if... North Korea doesn't take initial steps [to meet February's agreement]," one official told the Dong-a Ilbo daily.

Meanwhile, there was reaction from North Korea's other dialogue partners over the missed deadline, with Russia accusing the US over the funding row.

"We cannot move forward as long as the North Korean side says that it has not received the money," Deputy Foreign Minister Alexander Losyukov said. "We need to talk not about deadlines but about fulfilling these agreements," he said.

Japan said it was "extremely regrettable" that the North missed Saturday's deadline, adding that setting a new deadline was "not appropriate". US nuclear negotiator Christopher Hill says the missed deadline is cause for concern, but has also acknowledged Chinese requests for patience from the US.

North Korea said at the end of last week it was waiting to confirm it could access its frozen accounts in Macau-based Banco Delta Asia. The funds were frozen after the US accused the BDA in 2005 of acting as a conduit for money earned by Pyongyang from illegal activities, claims the bank denies.

Last month, the US blacklisted the bank, calling it a "willing pawn" in North Korea's illegal activities. On Monday, BDA announced it was challenging the ruling which, it said, "lacked specific facts or evidentiary support" and was "politically motivated since it was based on disputes between the United States and North Korea".

BBC