[Senate Hearing 108-157]
[From the U.S. Government Publishing Office]
S. Hrg. 108-157
DRUGS, COUNTERFEITING, AND WEAPONS
PROLIFERATION: THE NORTH KOREAN
CONNECTION
=======================================================================
HEARING
before the
FINANCIAL MANAGEMENT, THE BUDGET, AND INTERNATIONAL SECURITY
SUBCOMMITTEE
of the
COMMITTEE ON
GOVERNMENTAL AFFAIRS
UNITED STATES SENATE
ONE HUNDRED EIGHTH CONGRESS
FIRST SESSION
__________
MAY 20, 2003
__________
Printed for the use of the Committee on Governmental Affairs
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WASHINGTON : 2003
____________________________________________________________________________
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COMMITTEE ON GOVERNMENTAL AFFAIRS
SUSAN M. COLLINS, Maine, Chairman
TED STEVENS, Alaska JOSEPH I. LIEBERMAN, Connecticut
GEORGE V. VOINOVICH, Ohio CARL LEVIN, Michigan
NORM COLEMAN, Minnesota DANIEL K. AKAKA, Hawaii
ARLEN SPECTER, Pennsylvania RICHARD J. DURBIN, Illinois
ROBERT F. BENNETT, Utah THOMAS R. CARPER, Delaware
PETER G. FITZGERALD, Illinois MARK DAYTON, Minnesota
JOHN E. SUNUNU, New Hampshire FRANK LAUTENBERG, New Jersey
RICHARD C. SHELBY, Alabama MARK PRYOR, Arkansas
Michael D. Bopp, Staff Director and Chief Counsel
Joyce Rechtschaffen, Minority Staff Director and Chief Counsel
Darla D. Cassell, Chief Clerk
------
FINANCIAL MANAGEMENT, THE BUDGET, AND INTERNATIONAL SECURITY
SUBCOMMITTEE
PETER G. FITZGERALD, Illinois, Chairman
TED STEVENS, Alaska DANIEL K. AKAKA, Hawaii
GEORGE V. VOINOVICH, Ohio CARL LEVIN, Michigan
ARLEN SPECTER, Pennsylvania THOMAS R. CARPER, Delaware
ROBERT F. BENNETT, Utah MARK DAYTON, Minnesota
JOHN E. SUNUNU, New Hampshire FRANK LAUTENBERG, New Jersey
RICHARD C. SHELBY, Alabama MARK PRYOR, Arkansas
Michael Russell, Staff Director
Richard J. Kessler, Minority Staff Director
Amanda Linaburg, Chief Clerk
C O N T E N T S
------
Opening statement:
Page
Senator Fitzgerald........................................... 1
Senator Akaka................................................ 6
Senator Lautenberg........................................... 11
WITNESSES
Tuesday, May 20, 2003
Andre D. Hollis, Deputy Assistant Secretary for Counternarcotics,
U.S. Department of Defense..................................... 3
William Bach, Director, Office of Asia, Africa, and Europe,
Bureau of International Narcotics and Law Enforcement Affairs,
U.S. Department of State....................................... 5
Nicholas Eberstadt, Ph.D., American Enterprise Institute......... 14
Larry M. Wortzel, Ph.D., Heritage Foundation..................... 16
Robert L. Gallucci, Ph.D., Georgetown University Walsh School of
Foreign Service................................................ 18
Former North Korean High-Ranking Government Official, Identity
Protected...................................................... 24
Bok Koo Lee [Alias], Former North Korean Missile Scientist....... 27
Alphabetical List of Witnesses
Bach, William:
Testimony.................................................... 5
Prepared statement........................................... 39
Eberstadt, Nicholas, Ph.D.:
Testimony.................................................... 14
Prepared statement........................................... 45
Former North Korean High-Ranking Government Official:
Testimony.................................................... 24
Prepared statement........................................... 70
Gallucci, Robert L., Ph.D.:
Testimony.................................................... 18
Prepared statement........................................... 69
Hollis, Andre D.:
Testimony.................................................... 3
Prepared statement........................................... 36
Lee, Bok Koo:
Testimony.................................................... 27
Prepared statement........................................... 73
Wortzel, Larry M., Ph.D.:
Testimony.................................................... 16
Prepared statement........................................... 50
Appendix
List entitled ``North Korean Provocations, 1958-2003,'' submitted
for the record by Senator Fitzgerald........................... 33
DRUGS, COUNTERFEITING, AND WEAPONS
PROLIFERATION: THE NORTH KOREAN
CONNECTION
----------
TUESDAY, MAY 20, 2003
U.S. Senate,
Subcommittee on Financial Management,
the Budget, and International Security,
of the Committee on Governmental Affairs,
Washington, DC.
The Subcommittee met, pursuant to notice, at 2:08 p.m., in
room SD-342, Dirksen Senate Office Building, Hon. Peter G.
Fitzgerald, Chairman of the Subcommittee, presiding.
Present: Senators Fitzgerald, Akaka, and Lautenberg.
OPENING STATEMENT OF SENATOR FITZGERALD
Senator Fitzgerald. I am going to call the Subcommittee to
order. Senator Akaka is on his way over, but in the interest of
time, we want to begin now. There will be a vote I believe at
2:20 p.m..
Today, the Governmental Affairs Subcommittee on Financial
Management, the Budget, and International Security is holding a
hearing on Drugs, Counterfeiting, and Weapons Proliferation:
The North Korean Connection.
I would like to welcome our distinguished witnesses who are
here today, including two North Korean defectors. They will be
on the third panel.
I would like to take a moment, at the outset, to describe
the logistics of the hearing for the benefit of members of the
media and those in the audience. The hearing will be held in
open session through the first round of panel 3 that includes
the North Korean defectors. Those witnesses have asked that we
protect their identities. Therefore, screens will be installed
at the witness table for panel 3, and we ask that members of
the media and the public not attempt to breach the screens.
The defectors have also indicated their willingness to
disclose additional highly sensitive information to the
Subcommittee in a closed session. Therefore, after the first
round of questions in open session, the Capitol Police will
secure the room for a closed, unclassified session. At this
time, members of the media and the audience will be asked to
leave the hearing room.
Thank you in advance for your cooperation.
Today, we will hear testimony that indicates or suggests:
One, that the North Korean Government runs a drug production
and trafficking business and essentially functions as a state-
level crime syndicate;
Two, that North Korea is using the hard currency generated
by its state-level crime syndicate to fund its military and
weapons programs, including possibly its nuclear weapons
program; and, therefore,
Three, the drug production and trafficking business run by
the North Korean Government or apparently run by the North
Korean Government poses a threat to international security.
While it is certainly true that in the past we have seen
governments function like crime syndicates--the Taliban
Government in Afghanistan comes to mind--the critical
difference in this case is evidence that the North Korean
regime is using proceeds from criminal activities to fund a
robust weapons program that already has a nuclear capability.
The two North Korean defectors have never appeared before
Congress until today. Their testimony will establish that North
Korea produces poppy and manufactures heroin for sale abroad.
The proceeds from these sales, as well as the proceeds from
sales of military weapons, fund North Korea's large military
and nuclear program that pose a growing threat to international
security.
The North Korean military has over 1 million active troops
and approximately 4.7 million reserves. By comparison, South
Korea has approximately 686,000 active troops and approximately
4.5 million reserves. The United States has roughly 38,000
troops in South Korea. North Korea also has over 200 Scud
missiles and 2,500 rocket launchers, many of which can carry
chemical weapons.
Given the nexus between its state-level drug production and
trafficking business and its weapons programs, North Korea is
essentially a crime syndicate with nuclear bombs or, as one
commentator put it, ``It is a mafia masquerading as a
government.''
The role of a government is to protect its citizens from
criminals, but in the case of North Korea, it appears that the
government is the criminal. Since 1976, there have been over 50
documented incidents, many involving the arrest or detention of
North Korean diplomats directly linking the North Korean
Government to drug production and trafficking.
And I would like to, at this point, refer to the poster we
have over there by the video screen, and I would like to
include that list in the record.\1\ The poster highlights some
of these activities. Without objection, I ask that this list,
prepared by the Congressional Research Service be included in
the record.
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\1\ The list entitled ``North Korean Provocations, 1958-2003,''
submitted for the record by Senator Fitzgerald appears in the Appendix
on page 33.
---------------------------------------------------------------------------
There even have been reports, which one of our witnesses
will confirm today, that North Korea was limiting food crop
production in favor of poppy crop production. In North Korea,
it appears that the government is the drug lord.
The world witnessed a graphic example of North Korea's role
in drug trafficking last month when, on April 20, Australian
police arrested 26 crew members of a North Korean ship called
Pong Su after being spotted trying to off-load approximately
$80 million of heroin to a fishing boat off the coast of
Australia. The Australian Navy and police boats forced the
4,000-ton Pong Su into Sydney Harbor, after it was chased for 4
days and several hundred miles along Australia's East Coast.
Australian officials have now identified one of the crew as
a senior member of the North Korean Workers Party and continue
to investigate additional links between the captured freighter
and the North Korean Government.
I would now like to ask staff to play a news video produced
by ONE News of New Zealand regarding the capture of the Pong
Su.
[Video played.]
Senator Fitzgerald. The Australian incident poses grave
threats and challenges to the Northeast Asia region, as well as
to the international community, including the United States.
Therefore, one question we will explore today is whether North
Korean is exporting deadly drugs so it can build even deadlier
weapons of mass destruction.
Since Senator Akaka is not here yet--we will turn to the
panelists. And if Senator Akaka arrives imminently, we may
break to allow him to give his opening statement. We are
pleased to have with us two senior officials from the
Department of Defense and the Department of State.
Andre Hollis serves as the deputy assistant secretary of
Defense for Counternarcotics. In this capacity, Mr. Hollis
develops the Defense Department's counternarcotics policy,
manages over 100 programs that support counternarcotics efforts
in the United States and abroad and oversees a budget in excess
of $800 million.
William Bach currently serves as the Director of the Office
of Asia, Africa and Europe for the State Departments' Bureau of
International Narcotics and Law Enforcement Affairs. He has
held this position since 2001 and manages a budget of over $200
million.
Thank you both for being here today. In the interest of
time, we ask that you summarize your statements, if possible,
and we can simply take your longer statements and include them
in the record.
Mr. Hollis, would you like to proceed with your opening
statement?
TESTIMONY OF ANDRE D. HOLLIS,\1\ DEPUTY ASSISTANT SECRETARY FOR
COUNTERNARCOTICS, U.S. DEPARTMENT OF DEFENSE
Mr. Hollis. Thank you, Mr. Chairman, and thank you for the
opportunity to speak before you this afternoon about our
concerns----
---------------------------------------------------------------------------
\1\ The prepared statement of Mr. Hollis appears in the Appendix on
page 36.
---------------------------------------------------------------------------
Senator Fitzgerald. Could you pull the microphone a little
bit closer to your face, please. Thank you.
Mr. Hollis. Thank you, again, sir. I am pleased to appear
before you to discuss concerns about North Korea's involvement
in illicit drug trafficking.
Over the past several years, as you noticed this afternoon,
there have been numerous reports of drug seizures linked to
North Korea, primarily of methamphetamine and heroin destined
for Japan, Taiwan, China, Russia, and elsewhere.
The recent seizure, 50 kilograms of heroin transported by
the Pong Su, again, as you mentioned, demonstrates that
elements with North Korea are extending their illicit
activities south into Australian waters. This incident
underscores the need for multilateral, multi-agency efforts to
detect, monitor, and interdict North Korean drug trafficking.
I would like to summarize a point that you very well
mentioned, sir, and that is that the Pong Su seizure does, in
fact, heighten our concern that North Korean officials may be
using illicit trading activities to produce much needed hard
currency.
It is clear that any illicit trafficking involving North
Korea is a potential threat to the security of our friends and
allies in the region and to the United States. The Australian
Government, most notably its foreign minister, have called upon
multilateral efforts to work to combat drug smuggling from
North Korea.
We support that call, and we stand ready, as part of the
interagency of the U.S. Government, to work with our friends
and allies in the region. To that end, officials within the
Department of Defense, State, Justice, the Drug Enforcement
Administration, and the intelligence community are reviewing
what types of assistance that we are authorized to provide and
how to provide that should our friends and allies in the region
request it.
Practically speaking, I would like to summarize for you
some of the authorities that the Department of Defense has
given to provide support to our partner nations in terms of
countertrafficking in drugs.
First and foremost, we are authorized to provide support to
law enforcement agencies and military personnel with
counterdrug responsibilities. We provide training, we upgrade
equipment, we maintain a series of intelligence initiatives,
both in terms of collection analysis and dissemination of
intelligence among law enforcement, military and intelligence
services, command and control systems that allow our allies and
friends to communicate that information real time, as well as
the ability to assist them with minor infrastructure.
The Department and our agency counterparts are fully
capable and ready to support regional partners with training,
facilities, intelligence, and organizational experience to
counter the threat of illicit trafficking that may be coming
from North Korea.
The Department of Defense with, again, our interagency
partners, have a long history of bringing together interagency
capabilities and personnel to assist and to fuse our efforts to
fight drug trafficking. The interagency drug task forces that
exist in both Florida, and Alameda, California, and the
Congress has generously funded are wonderful examples of the
interagency fusion that might be appropriate for East Asia.
These task forces bring together law enforcement,
intelligence and military services to work jointly with partner
nations to battle the trafficking of a variety of substances,
including drugs. In particular, sir, this approach has been
very good at dealing with the trafficking threat in Southeast
Asia, Thailand, and Malaysia, in particular.
In sum, sir, we are working closely with our interagency
allies. I know that the State Department is talking to our
friends and allies in the region about what we might be able to
do in assistance, and as we continue to work to that end, we
will, of course, continue to consult with the Congress.
I look forward to accepting and answering all of your
questions.
Senator Fitzerald. Thank you, Mr. Hollis. Mr. Bach.
TESTIMONY OF WILLIAM BACH,\1\ DIRECTOR, OFFICE OF ASIA, AFRICA,
AND EUROPE, BUREAU OF INTERNATIONAL NARCOTICS AND LAW
ENFORCEMENT AFFAIRS, U.S. DEPARTMENT OF STATE
Mr. Bach. Good afternoon, Mr. Chairman.
---------------------------------------------------------------------------
\1\ The prepared statement of Mr. Bach appears in the Appendix on
page 39.
---------------------------------------------------------------------------
Thanks for this opportunity to testify before the
Subcommittee on the subject of narcotics trafficking and other
criminal activity with a connection to the Democratic People's
Republic of Korea. My oral testimony will summarize the written
report that you already have.
For some 30 years, officials of the DPRK and other North
Koreans have been apprehended for trafficking in narcotics and
other criminal activity, including passing counterfeit U.S.
notes. Since 1976, there have been at least 50 arrests and drug
seizures involving North Koreans in more than 20 countries
around the world. More recently, there have been very clear
indications, especially from a series of methamphetamine
seizures in Japan, that North Koreans traffic in, and probably
manufacture, methamphetamine drugs.
Given the tight controls in place throughout North Korea
and the continuing seizures of amphetamines and heroin
suspected of originating from North Korea, one must ask how any
entity, other than the state, could be responsible for this
high-volume drug trafficking.
Much of what we know about North Korean drug trafficking
comes from drug seizures and apprehensions abroad. A typical
incident of drug trafficking in the mid 1970's, when
trafficking by North Koreans first emerged as a significant
problem, would involve a North Korea employee of a diplomatic
mission or a state enterprise would be apprehended with illicit
drugs by police or border crossing officials.
In a very recent case, noted by this Subcommittee already,
Australian Federal police reported that on the night of April
16 of this year, police observed the North Korean vessel Pong
Su relatively close to the shore off the coast of Victoria. The
police followed two ethnic Chinese suspects on the shore as
they left the beach and headed for a nearby hotel. The next
morning, the two suspects were arrested with 50 kilograms of
heroin. The ethnic Chinese suspects, and the captain and crew
of the Pong Su have been charged with narcotics trafficking and
a protest has been lodged with Pyongyang by Canberra.
By 1995, North Korea had begun importing significant
quantities of ephedrine, the main input for methamphetamine
production. At about this time, methamphetamine was emerging as
a drug of choice all over Asia. During the next several years,
the Japanese seized numerous illicit shipments of
methamphetamine that they believed originated in North Korea,
and most of these seizures, traffickers and North Korean ships,
rendezvoused at sea in North Korean territorial waters for
transfer of the narcotics to the Japanese traffickers' vessels.
Taiwanese authorities also seized several shipments of
methamphetamine and heroin that had been transferred to the
traffickers' ships from North Korean vessels.
In both the cases of Japan and Taiwan, large quantities of
drugs were transferred from North Korean state-owned ships, on
occasion from North Korean naval ships, to the traffickers'
ships.
The U.S. Secret Service Counterfeit Division is aware of
numerous cases of counterfeiting with North Korean connections.
Typical of such cases was one reported in Macao in 1994, when
North Korean trading company executives, who carried diplomatic
passports, were arrested for depositing $250,000 in counterfeit
notes in a Macao bank. There are numerous other counterfeiting
incidents with links to Macao banks, North Korea and North
Korean diplomats.
North Korean traffickers have links to Russian, Japanese,
Taiwanese, China, Hong Kong, and Thai organized crime elements.
In all cases, the relationships began as one of wholesaler with
retailer. North Koreans with large quantities of drugs to sell
have sold them to criminal groups with the retail networks
necessary to move the drugs to consumers. This wholesaler/
retailer relationship seems to have evolved in recent years.
Incidents such as the Pong Su arrest, for example, demonstrate
that North Korean traffickers are becoming involved farther
down the trafficking chain.
Mr. Chairman, I thank you and the Members of the
Subcommittee for your attention, and I would be pleased to
answer any of your questions.
Senator Fitzgerald. We are going to have to take a brief
recess because a vote has begun. If you gentlemen could be kind
enough to wait for me to return, and perhaps Senator Akaka will
come here after the vote, it will be just a few more minutes,
and we will be right back. We will ask our questions, and then
we will excuse you.
Thank you very much for your testimony. We will take a
brief recess.
[Recess.]
Senator Fitzgerald. We will resume the Subcommittee hearing
now. I appreciate your patience, and sorry to keep you waiting
as I voted.
Senator Akaka, the Ranking Member, has joined us, and,
Senator Akaka, I would like to give you the opportunity to make
your opening statement. Thank you for being here.
OPENING STATEMENT OF SENATOR AKAKA
Senator Akaka. Thank you very much, Mr. Chairman. I
appreciate what you are doing with the Subcommittee and your
leadership in this area. I want to ask that my full statement
be placed in the record, and I will make a brief statement.
Senator Fitzgerald. Without objection.
[The prepared opening statement of Senator Akaka follows:]
PREPARED OPENING STATEMENT OF SENATOR AKAKA
Mr. Chairman, I appreciate the opportunity to be here this
afternoon for the first hearing of this Subcommittee under your
leadership. I am also pleased that the first hearing is on an issue
relating to international security. Our Committee and this Subcommittee
have a long history of engagement on these issues, and I am glad you
are continuing both this tradition and this responsibility.
I share your concern over the situation in North Korea. We do not
need to invade North Korea to find proof of its involvement in weapons
and drug trafficking.
This hearing highlights a critical issue in international efforts
to control the spread of weapons of mass destruction: The emergence of
new suppliers of WMD technology and expertise. North Korea, for
example, has exported ballistic missiles and related technology to
Egypt, Syria, Iran, Libya, and Pakistan. Missile exports are a major
source of hard currency for North Korea. There is little sign North
Korea will end its exports unless under either a positive or negative
incentive. North Korea is also capable of producing chemical and
biological weapons although there has been no evidence to date that
North Korea has exported either of these types of weapons or the
technology to produce them. We now fear that North Korea's nuclear
weapons program will lead it to export both technology and plutonium to
other states.
I commend recent efforts by the administration to engage North
Korea in a dialogue on these issues. I wish that this engagement had
occurred sooner and had built on the momentum left from the previous
administration which seemed close to achieving an agreement on halting
North Korea missile exports.
We have two policy choices: Either to attempt to negotiate a
mutually satisfactory solution with North Korea, leading to an
accommodation, if not acceptance, of an authoritarian regime. The
second would be to pursue a strategy of isolation and hostility,
leading eventually to conflict with the North.
The first approach is repugnant to many because it assumes we make
peace with the devil. The second might result in a second Korean War. I
would suggest that negotiation, however, buys time to change North
Korea from within and, if our negotiations are successful, will end the
threat of North Korean proliferation.
I do not know if it is possible to reach an agreement with North
Korea that will halt--and roll back--its WMD programs. I do know that
if we do not engage North Korea seriously, we will never know if such
an agreement could have been reached. I also believe we should pursue
both bilateral and multilateral negotiations. We should take whichever
road that offers the promise of ending the North Korean weapons
program.
The North Koreans will have to make significant concessions--and we
will too. That is the price of any successful set of negotiations. And
benefits must be mutual.
I look forward to our witnesses today. I hope you can clarify for
me our options in dealing with North Korea even as they detail our
concerns about the North's proliferation and criminal activities. Thank
you, Mr. Chairman for having this hearing this afternoon.
Senator Akaka. Mr. Chairman, I appreciate the opportunity
to be here with you this afternoon for the first hearing of
this Subcommittee under your leadership in this room.
I am also pleased that the first hearing is on an issue
relating to international security. Our Committee and this
Subcommittee has a long history of engagement on these types of
issues, and I am glad you are continuing, with both this
tradition and this responsibility.
I share your concern over the situation in North Korea. We
do need to invade North Korea to find proof of its involvement
in weapons and drug trafficking. We have two choices, either to
attempt to negotiate a mutually satisfactory solution with
North Korea, leading to an accommodation, if not acceptance, of
an authoritarian regime. The second would be to pursue a
strategy of isolation and hostility, leading eventually to
conflict with the North.
The first approach is repugnant to many because it assumes
we make peace with the devil. The second might result in a
second Korean war.
I would suggest that negotiation, however, buys time to
change North Korea from within, and if our negotiations are
successful, will end the threat of North Korean proliferation.
I do not know if it is possible to reach an agreement with
North Korea that will halt or roll back its WMD programs. I do
know that if we do not engage North Korea seriously, we will
never know if such an agreement could have been reached.
I also believe we should pursue both bilateral and
multilateral negotiations. We should take whichever road that
offers the promise of ending North Korea's weapons program. The
North Koreans will have to make significant concessions, and we
will too. That is the price of any successful set of
negotiations, and benefits must be mutual.
I look forward to our witnesses today, Mr. Chairman. I hope
they can clarify, for me, our options in dealing with North
Korea, even as they detail our concerns about the North's
proliferation in criminal activities, and I want to thank you,
Mr. Chairman, very much for having this hearing.
Senator Fitzgerald. Senator Akaka, thank you very much.
Mr. Bach, I was wondering if the State Department had any
information, and I know it is very hard to find, about what
North Korea earns annually from legitimate exports of
legitimate products. Do you have any figures or would you know
how we could get some information on that?
Mr. Bach. Thank you, Senator.
No, I do not know the answer to the question, but we can
certainly get it for you. I do not have even a good estimate, I
am afraid. That is not my lane, but we can respond to you
later.
Senator Fitzgerald. We would appreciate it if you could get
the estimate, even if it is just an estimate of their revenues.
I believe we are going to have later testimony today that is
going to estimate that North Korea earns about $650 million a
year from the export of legitimate products, but something like
twice that from the export of drugs and weapons.
Mr. Bach, clearly, North Korea has been exporting weapons,
specifically missiles. They were caught red-handed with that
shipment off the coast of Yemen, which we interdicted, and then
we allowed them to go forward with that shipment.
Are there any international laws that they are violating
when they sell their missiles?
Mr. Bach. As I understand, that interdiction resulted in
the ship proceeding towards it destination. I do not know the
answer, if there were any international laws. I can get back to
you on that one as well.
Senator Fitzgerald. But, generally speaking, a country can
manufacture weapons and sell them.
Mr. Bach. That is correct.
Senator Fitzgerald. If they are selling drugs, presumably,
that would violate some international law, would it not? Or is
it possible for a country just to be in the business of
producing and selling drugs, such as heroin?
Mr. Bach. Certainly, there are licit production of opium
that take place in different countries, and it is exported
under controlled circumstances for use in making medicines, but
in the case of illegally importing or smuggling heroin into a
country, as happened with the Pong Su, that is definitely
illegal.
Senator Fitzgerald. Is there any law that they would be
violating if they are raising poppy for the production of
heroin, if they are just doing that domestically? Do you know
if North Korea is part of any treaty that forbids that?
Mr. Bach. I do not believe that it is, sir. I think that
they could grow poppy for the production of opium, which would
then be used for licit purposes in the production of
analgesics, but I do not think that heroin is something that
is--well, it would be legal to do within the country if it were
only for domestic purposes, I would imagine.
Senator Fitzgerald. But if they are not signatory to any
treaty, where they pledged not to export the heroin or the
poppy, it is possible they are not even violating international
law?
Mr. Bach. Until it gets to another country, that is
probably true, yes, sir.
Senator Fitzgerald. Mr. Hollis, according to the Central
Intelligence Agency's report to Congress, North Korea appears
to be seeking to produce one to two nuclear weapons a year and
has improved its missile technology. The North Koreans now
possess weapons capable of reaching the United States, while
carrying a nuclear weapons-sized payload.
As the report states, for some time now, North Korea has
demonstrated a willingness to sell missile systems to other
states. Are either of you on the panel, Mr. Hollis or Mr. Bach,
aware to which states has North Korea sold its missile systems
to in the past, other than Yemen?
Mr. Hollis. Sir, I will try to stay in my lane of Canon
narcotics, but I will be happy to take your question back and
refer that to the appropriate offices within the Department of
Defense and get you an answer.
Senator Fitzgerald. We would appreciate that. Thank you.
Mr. Bach. I subscribe to that answer.
Senator Fitzgerald. Same with Mr. Bach, OK.
We have Senator Lautenberg here. I would like to recognize
Senator Lautenberg, and we can make time for you to make an
opening statement when you are ready or join the questioning,
too.
Senator Lautenberg. Thank you very much, Mr. Chairman. I
will kind of catch up first. Thank you.
Senator Fitzgerald. Thank you. Senator Akaka, would you
have any questions?
Senator Akaka. Yes, thank you very much, Mr. Chairman.
I have questions for both of you.
One witness in our next panel recommends that we work with
the intelligence, customs, and law enforcement agencies of
other countries, particularly those neighboring North Korea, to
crack down on drug shipments. The Chairman has stated the
problem real well. My question to both of you is are we not
doing this already, and why is it not working? Mr. Hollis.
Mr. Hollis. Thank you, Senator. And once again it is an
honor to be here before you, and I would be happy to answer the
question from DOD's perspective.
If I may put it in context, sir, with respect to
counternarcotics, particularly outside the United States, the
Department of Defense has some specific responsibilities, and I
want to set those out so that my answer to you is in the proper
context.
First and foremost, the Department shall serve as the lead
agency for the detection and monitoring of maritime and aerial
drug trafficking toward the United States. That is not
necessarily a role and responsibility that is required here.
Worldwide, however, working in support of the Department of
State and in support of host nation law enforcement agencies
with counterdrug responsibilities, we can, once they request,
provide a variety of forms of support--training, upgrading
their equipment, intelligence sharing, collection analysis,
some infrastructure support, and some transportation support.
All of that is predicated upon the country asking us, through
the embassy, for that support, and we work with our interagency
colleagues.
We do provide a variety of forms of support throughout
Asia, in particular, in Southeast Asia, and there are other
agencies within the U.S. Government that do provide support in
North Asia.
So what I am trying to say to you, sir, is when the
countries request support, through the respective embassies,
the embassies send those requests in, and the appropriate
agency, as part of the U.S. Government, will provide that
support, but we stand ready to provide that support.
Senator Akaka. Mr. Bach.
Mr. Bach. Yes, Senator. We do have that mandate to help
countries coordinate their defenses against narcotics. We tend
to do it in countries where the threat is directed at the
United States, and we do not know of any incidents where
narcotics that we think originated from North Korea have come
to the United States.
We do help countries in Southeast Asia with their
counternarcotics programs. We do not have very many programs in
North Asia, and that is because, in the case of China, we do
not have a letter of agreement, a treaty, with China to
cooperate on counternarcotics. In the case of Korea, Japan, and
Taiwan, those are countries that are rich in resources
themselves, and they do not need our assistance.
So the countries that are targeted by the North Koreans,
particularly, do not seem to qualify, in most cases, for the
sorts of assistance programs that INL provides.
Senator Akaka. I take it that China does not permit DEA
into China.
Mr. Bach. It actually has just arrived at some sort of an
agreement where they are permitting DEA to work with the
Chinese officials on counternarcotics matters. And, in fact,
DEA does have offices in many of these countries, and that is
we are deriving quite a bit of our information from very good
cooperative relationships between law enforcement on our side
and Japan and Taiwan in particular.
Senator Akaka. Here is another question to both of you. Do
you have any evidence that foreign diplomats stationed in North
Korea are involved in helping North Koreans traffic in drugs?
Mr. Hollis.
Mr. Hollis. Sir, I am personally unaware of anything, in
response to your question. But, again, I would be happy, if you
would like, to refer that question to the intel community. I am
sure that, under the appropriate circumstances, they would be
happy to respond to you.
Senator Akaka. Thank you. Any comment on that, Mr. Bach?
Mr. Bach. No, sir.
Senator Akaka. My other question is, is there any evidence
that North Korea is not growing poppies, but importing them to
process into heroin? And if that is so, from where do they
obtain these raw products?
Mr. Bach. I can try to answer that, sir. We are not certain
where they are getting the heroin. We have heard reports, of
course, that some of the heroin that is being trafficked by
North Koreans has originated in Southeast Asia, but we have
also heard that Korean processors of opium into heroin use
packaging that is made to look as though it comes from
Southeast Asia, so it could be a ruse.
As far as attempts made at identification of poppy
cultivation inside of North Korea, we have, in 1996 and 1999,
used overhead imagery to try to identify cultivation of poppy,
and in neither of those cases were we able to identify
sufficient quantities of what looked like poppy from the
satellite imagery to identify North Korea as a major producer;
that is to say, that it has 1,000 hectares under poppy
cultivation, and that has to do with the fact that we have not
had a ground-truthing survey in conjunction with the aerial
survey.
Typically, you have to have people on the ground talking to
farmers, getting more information for the analysis that then
can be used to establish the poppy signature by the overhead
imagery. So we do not have that kind of information.
Senator Akaka. Thank you very much, Mr. Chairman.
Senator Fitzgerald. Senator Lautenberg, I do not know
whether you would care to make an opening statement at this
time?
OPENING STATEMENT OF SENATOR LAUTENBERG
Senator Lautenberg. Mr. Chairman, I appreciate the
opportunity that we have to try to decipher where it is we want
to go with our policy with North Korea. Do we have a gain or a
loss by bringing the two things together? And that is to try to
have a counterdrug effort and to be talking about that, when it
is hard to evaluate, which is the more terrible, more evil
thing, and that is to talk about whether or not weapons of mass
destruction are being produced, ballistic missiles, etc., in
North Korea. That hostility is obvious. The other is kind of
sub rosa, as it is throughout the world, in terms of drug
trafficking.
I would ask you, Mr. Hollis, whether, to start this, if I
may, Mr. Chairman--and that is are we pursuing our drug
enforcement policy with the same vigor, with the same
equipment, the same knowledge that we do in other parts of the
world, like we do in Colombia, let us say, or we do in other
places or do domestically?
Do we use our satellite technology to try and find out
whether these things, to Senator Akaka's question, is there
poppy cultivation in North Korea? And in a way I am not sure
that that is so relevant because if you want to get that stuff,
it is available all over the world, but just to try to
determine how much effort we are putting into this.
Mr. Hollis. Thank you, Senator. That is a very good
question, and it is a question that a lot of bright people,
with a lot of pay grades even higher than my own, are working
on as we speak.
The question is to what extent, if I understand correctly,
to what extent is the level of effort that we, as the
international community, execute in counterdrug, say, in
Northeast Asia? Should it be greater, should it be less, in
comparison to, say, our efforts with our friends in----
Senator Lautenberg. Southeast Asia or----
Mr. Hollis. Yes, sir. There are a lot of people who are
working on that question and who are thinking about that
question. I think it is also fair to say that it has not been a
question that a lot of people have pondered in the recent past.
Senator Lautenberg. But we know, directly, that there is a
flow, that there is a lot of drug activity, that the ship, the
Pong Su, etc., but we have other evidence as well, as I
understand it, and do we see a direct flow from there to here,
into the United States?
Mr. Bach shakes his head, no, and that is interesting
because that is where I want to go. I would like to know, Mr.
Chairman, whether or not this is a--drugs invading our society
are always a serious threat, but is this of the magnitude that
we want to put the law enforcement effort into it? It is always
more difficult when we have no relationship with the company.
Again, I used Colombia before as an example. We have got full-
fledged diplomatic and functional relations going on there.
So is this of the magnitude that it ought to take us off
the topic, the principal topic, or will this, as a matter of
fact, negate some of the work that we are trying obviously to
do, to have a dialogue? At least I speak for my own vantage
point, I would like to see a dialogue going on there. I do not
think we are of the capability or of the mood to do an Iraq
over there and invade the country to try and quell their
capability for developing weapons of mass destruction.
Mr. Bach, do you want to comment on that?
Mr. Bach. Yes, Senator. I wanted to comment on my shake of
the head earlier, which is that we do not have any evidence
that the North Korean drugs are coming to the United States.
There have been no incidents so far of drugs we can trace to
North Korean traffickers coming to the United States.
In terms of the amount of effort that we are placing in the
countries that are most targeted by the North Koreans--Taiwan
and Japan--we are cooperating with those countries in terms of
a lot of various economic programs, of course, and certainly
law enforcement and coordination of law enforcement efforts,
from the point of view of DEA, for example, the Japanese, those
relations are very close.
In terms of the kind of assistance that we are giving to
the Andean Ridge in Colombia, for example, it is not analogous
in the case of Japan. They have about 2.2 million users of
amphetamine-type substances in Japan. They are dealing with
them domestically. They do not need our assistance in doing
that. We are trying to give them whatever assistance we can, in
terms of providing a platform for coordination with other
countries to work together in counternarcotics, but we are not
giving them the kind of assistance programs that we have for
countries that do not have the level of resources that Japan
and Taiwan have.
I think that answers----
Senator Lautenberg. Yes. So we are doing it for the well-
being of our friends and allies, and that is OK.
The question is, going directly to the subject at hand, and
that is North Korea. We have got a lot to worry about we think
there from all kinds of things, and whether the scourge is the
threat from nuclear or ballistic missiles or whether it is from
a drug invasion, which can, in many ways, be very effective in
debilitating a society. But, if not, should you both be at the
table at the same time, I ask, Mr. Chairman, with all due
respect? Is one counter to the other in any way?
Mr. Hollis. Senator, if I may offer just a quick comment,
sir, and it is more a question that really is worthy of
discussion and thought.
If, working with our friends and allies, we are able to
detect and monitor the movement of drugs by air, by land, and
by sea, what else will you see?
Senator Lautenberg. Well, we should do it. Yes, we should
do it and take that information. But just so we understand
here, for our own use and legislative purpose, is it the kind
of thing because I, frankly, my focus would be much more on the
build-up of weapons, and the antagonisms that are going there,
and where I worry a lot about, South Korea and other places
near North Korea, and how much effort we should put into the
North Korean threat and not diverting it with a lot of other
things.
And I am content, if you both kind of confirm the fact that
we are doing this for our friends and allies, and providing
part of an intelligence or whatever network that we can to stop
the drug flow, but the question about what should we do to try
and get a relationship going with North Korea that takes down
the weapons threat and offers us a chance to have some kind of
a dialogue, but that can have us not pointing guns at one
another, but pointing hands at one another; Mr. Bach, what is
the State Department's inside view, confidentially, among this
group?
Mr. Bach. Thanks, Senator.
I think we are very eager to get into a relationship with
North Korea, where they stop doing what they are doing with
missile exports, and drugs and development of nuclear weapons.
We would like very much if the North Koreans would behave more
reasonably in a lot of different areas, and we are trying to
work together with our allies and friends to make sure that we
do together what we can to bring that sort of attitude to the
North Korean leadership.
And it is very difficult, of course, to reach them, but we
are trying, as we can, with counternarcotics policies and law
enforcement cooperation to bring about that mind-set in the
North Korean leadership. I think that is the most helpful thing
that we can do. I do not think of opposition to narcotics
trafficking by North Korean vessels as a diversion or a
distraction from the main game. I think it is all part of the
same fabric of rather irrational behavior on the part of the
North Korean Government.
Senator Lautenberg. Is it thought that drug trafficking is
part of the North Korean national policy?
Mr. Bach. We cannot say for sure, definitively, that it is
part of the state policy. We can only surmise that it would be
very difficult for the state not to be involved because it
seems to have totalitarian control over much of the enterprise
that takes place in the country, much of the agriculture,
certainly much of the trading, and many of the people that have
been apprehended as trafficking in drugs or counterfeit bills
have had diplomatic passports, so we think that there must be
some association, although we cannot say that it is guided by
the state.
Senator Lautenberg. I thank the gentlemen. Thanks, Mr.
Chairman.
Senator Fitzgerald. Thank you, Senator Lautenberg.
And I would like to thank Mr. Hollis and Mr. Bach for their
testimony today. We appreciate your coming up to the Senate to
testify.
And with that, I would like to dismiss the first panel and
invite the second panel to come up. We have Dr. Robert
Gallucci, the dean of Georgetown University Walsh School of
Foreign Service; Nick Eberstadt, the Henry Wendt Scholar in
Political Economy at the American Enterprise Institute; Larry
Wortzel, vice president and director of the Heritage
Foundation's Davis Institute for International Policy Studies.
[Pause.]
Senator Fitzgerald. Well, thank you very much. Thank you
all for being here.
Dr. Eberstadt, I would invite you to begin first with your
testimony, and then we will proceed from my left to right.
TESTIMONY OF NICHOLAS EBERSTADT, Ph.D.,\1\ AMERICAN ENTERPRISE
INSTITUTE
Mr. Eberstadt. Mr. Chairman, distinguished Members of the
Subcommittee, and esteemed colleagues and guests. It is always
a pleasure and an honor. With your permission, I will submit
written record later.
---------------------------------------------------------------------------
\1\ The prepared statement of Mr. Eberstadt appears in the Appendix
on page 45.
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I thought I would begin with a little bit of background
research, since I have no security clearances, and thus only
know what I read in the newspapers about DPRK merchandise in
counterfeiting weapons and drugs.
If we can move to the first slide, please.
What we have here is some of my homework. I have tried to
reconstruct North Korean trade patterns according to what we
call ``mirror statistics,'' which is to say North Korea's trade
partners' reports about purchases and sales of merchandise by
the DPRK. These are highly incomplete and quite limited, but
they provide some insight I think that may be useful.
This Figure 1 shows total reported North Korean export
revenues over the period from 1989 to 2001. Of course, then
went down after the end of the Soviet Union. The point to take
home here I think is that North Korea, as a state, has
essentially no legitimate, legal visible means of support.
In the year 2001, the DPRK reportedly, through these data,
earned $750 million in total revenue through nonmilitary
merchandise sales. To put that amount in perspective, it would
be less than $40 per capita for the country as a whole--an
absolutely extraordinarily low level for an urbanized literate
population.
Senator Fitzgerald. What were they exporting back in the
late 1990's that had them at a much higher figure?
Mr. Eberstadt. They had export arrangements, whereby the
Soviet Union was obliged to purchase their supplies--textiles,
magnesite, cement, steel, other products of that sort--but
those were, so to speak, forced purchases.
Senator Fitzgerald. So their buyer evaporated with the
demise of----
Mr. Eberstadt. Their buyer evaporated, and there were no
new markets for these products.
Senator Fitzgerald. Now, is the $650 million or $700
million in legitimate exports that they now have mainly
textiles?
Mr. Eberstadt. It would be textiles, gold, steel, cement,
some agricultural products, including sea products, fish,
seaweed, mushrooms, and the like.
Senator Fitzgerald. Thank you.
Mr. Eberstadt. The next slide, Figure 2, will show North
Korea's reported merchandise imports, what it is reported as
buying from other parts of the world. That has gone up since
1998 rather significantly to a little bit over $2 billion
reported.
And if we see the following slide, Figure 3, that will show
the discrepancy between what North Korea is reported as
earning, legitimately, and what North Korea has reported as
buying, and it is a big gap. The gap was down to about $600
million in the late 1990's, but has risen very substantially in
the early 2000's, above $1,200 million, about $100 million a
month.
This is the overall merchandise trade deficit. Part of that
discrepancy is due to China's subsidy of North Korea. And in
the final slide, Figure 4, we take China out of the equation,
and we see the unexplained excess of purchases over imports
going from under $100 million in 1997 up to above $800 million
in 2001.
This, if you will, invisible means of support for the DPRK
state includes foreign aid from other governments, including
our own; Japanese remittances from pro-DPRK groups in Japan;
South Korean tourism payments; secret South Korean official
payments, including the payments made to secure the Pyongyang
Summit of 2000; but also drugs, counterfeiting, and arms. We
cannot parse these out from these particular numbers, but we
can see that it has increased very substantially over the last
number of years.
May I make a few additional points, Senator?
Senator Fitzgerald. Yes.
Mr. Eberstadt. I would make five additional points, if I
could, very quickly.
First, I think it is reasonable, from what we read in the
newspapers, to conclude that drug and counterfeiting traffic
from the DPRK is a state business, not a rogue units business
or some private enterprise. There is essentially no private
enterprise in the DPRK. Ask yourself if it would be possible
for individual farmers to cultivate thousands of hectares of
opium, poppies, or to establish labs for methamphetamine
production. The question, I think, answers itself.
Second, drug and counterfeiting is part and parcel of North
Korean diplomacy, not an aberration, and we can see this by
looking back as far as the 1970's. In 1976, the Scandinavians
expelled North Korean diplomats for trafficking drugs, for
being caught trafficking drugs. Why did it take them until 1976
to catch them? Because they did not establish relations with
Pyongyang until 1973.
Similarly, why did it take Venezuela until 1977 to catch
North Korean diplomats trafficking drugs? Because Venezuela and
North Korea did not establish relations until 1974. You can go
on down the list.
Third, drug and counterfeiting trade is entirely consistent
with the official DPRK view of its legal and treaty
obligations, which is to say it is entirely opportunistic.
Pyongyang's is a predatory approach, and we see this in drugs
and counterfeiting of other countries' currencies.
Fourth, the DPRK, as a government, positively prefers, I
think, drug and counterfeiting business to other peaceful legal
means of merchandise trade. Again and again, the DPRK has
indicated that it views ordinary, peaceable commercial
merchandising as subversive of the authority of its state. Drug
and counterfeiting is not subversive of its authority, which is
to say drug and counterfeiting are part of the strategy for
state survival of the DPRK.
Fifth, and finally, if we can believe news stories, the
DPRK's drug and counterfeiting businesses are centralized
through something called Bureau No. 39 of the Workers Party of
the DPRK. This is controlled by the highest authorities of the
state. That would correspondingly suggest that revenues entered
into through Unit No. 39 are also applied to the state's top
priorities. It is no secret that the DPRK enshrines ``military
first'' politics as its very top priority of state. Thus, it is
hardly wild to suggest that narcotics and counterfeiting may
directly be contributing to the WMD buildup that is threatening
the United States and her allies today.
Thank you, sir.
Senator Fitzgerald. Thank you very much, Dr. Eberstadt. Dr.
Wortzel.
TESTIMONY OF LARRY M. WORTZEL, Ph.D.,\1\ HERITAGE FOUNDATION
Mr. Wortzel. Mr. Chairman, distinguished Members of the
Subcommittee, thank you very much for the opportunity to
testify today.
---------------------------------------------------------------------------
\1\ The prepared statement of Mr. Wortzel appears in the Appendix
on page 50.
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North Korea's exports, from legitimate business in 2001,
this is according to the April 23, 2003, Wall Street Journal,
was about $650 million.
The income to Pyongyang from illegal drugs in the same year
was between $500 million and a billion dollars. Missile sales
earned Pyongyang about $560 million in 2001. North Korea
produces somewhere between 30 and 44 tons of opium a year,
according to testimony by the U.S. Forces Korea commander, and
the Guardian of England, on January 20, 2003, puts North Korean
counterfeiting profits at somewhere between $15 million and
$100 million a year--they say $100 million last year.
So, if you want to put economic pressure on the Government
of North Korea, if you do not want a military lever only, you
begin to take care of all of this other illegal trade. That is
one way to do it. The Kim Jong-il regime resembles more a cult-
based, family-run criminal enterprise than a government.
And according to a Congressional Research Service 1999
report, North Korea seems to support its diplomatic presence
overseas, and its intelligence activities around the world,
through these illegal drug sales and counterfeiting.
North Korean diplomats, workers, and officials have been
caught selling opiates, including heroin, as well as
amphetamines and date-rape drugs in Japan, China, Russia,
Taiwan, Egypt, the Czech Republic, Bulgaria, and South Korea.
The State Department, however, in its 2003 International
Narcotics Strategy Control Report, could provide no conclusive
evidence of illicit opium production in North Korea. Well, I
just am a little skeptical of that conclusion.
Now, Senator Lautenberg is no longer here, but I think it
is important for us to remember that the same network of North
Korean officials that distribute those drugs and distribute
that opium could distribute nuclear materials, and that is not
far off what Li Gun said to Assistant Secretary of State Kelly,
when he met him in Beijing, as sort of an offhand threat. I
think we have to take care of this, not as perhaps the priority
of the U.S. Government, but it must be a priority.
I believe that we have to put pressure on North Korea, and
countries around it, to watch North Korean diplomats, military
and government officials who transport and sell drugs, and even
a place like China is likely to help with that.
North Korea has also exported significant ballistic
missile-related equipment, parts, materials, and technical
expertise to South America, Africa, the Middle East, South
Asia, and North Africa. The entire Pakistani program is
probably, the late, more long-range Pakistani program, their
Ghauri system, is all North Korean Nodong-based. That earns
them quite a bit of money.
India, in 1998, stopped and detained a North Korean ship at
Kandia that contained 148 crates of blueprints, machinery and
parts for ballistic missiles on the way to Pakistan from North
Korea.
Now, there has been talk of an air and sea quarantine of
North Korea as an economic measure. I would say to you that,
first of all, a quarantine is an act of war. The ship that was
intercepted on the way to Yemen was intercepted pursuant to
international law under United Nations sanctions against
Afghanistan.
Now, if we were able to do that and begin to get aircraft
and ships and check them, we still have the problem of whether
Russia and China would cooperate because North Korea could just
as well ship those things through China or Russia, and China
certainly facilitated all of North Korea's help to Pakistan. So
this is a diplomatic problem, and it has to be solved, I think,
through diplomatic means.
I think that there are measures we should take to address
these things. I think U.S. diplomats should be putting pressure
on the intelligence, customs and law enforcement agencies of
other countries and working with them to crack down on North
Korean drug and counterfeit money shipments.
They should stress that North Korea's drug trade is not an
independent operation, but it is controlled by the Kim Jong-il
regime.
Sponsoring governments should ensure that their own
embassies are actively not helping move these things back and
forth. That is another diplomatic lever.
Just as we have in the war on terror and in the war on
drugs, we can work with other international agencies and
foreign governments to crack down on financial institutions
overseas that support North Korea's criminal activities.
Now, Japan has $240 million in legal trade with North
Korea. Japan could take action there, if North Korea persists
in its illegal trade.
I think we still need to maintain a very strong military
presence overseas and that we need to be prepared to fight if
the North Koreans start a war, and I think we need to get
ballistic missile defenses deployed in the region just as
quickly as we can because of that military threat.
Finally, I think that when we do talk to North Korea, and I
think we should, it is absolutely imperative that it be done in
a multilateral context. We cannot and should not isolate our
ally, South Korea.
Economic assistance to North Korea should be predicated on
the verifiable end to its nuclear programs.
Thank you, Mr. Chairman, Senator Akaka.
Senator Fitzgerald. Dr. Gallucci.
TESTIMONY OF ROBERT L. GALLUCCI, Ph.D.,\1\ GEORGETOWN
UNIVERSITY WALSH SCHOOL OF FOREIGN SERVICE
Mr. Gallucci. Thank you, Mr. Chairman. Thank you for the
opportunity to appear before the Subcommittee today, and with
your permission, Mr. Chairman, I will submit some comments
formally for the record.
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\1\ The prepared statement of Mr. Gallucci appears in the Appendix
on page 69.
---------------------------------------------------------------------------
Senator Fitzgerald. Without objection.
Mr. Gallucci. I understand the subject today, Mr. Chairman,
is the connection between the drug and counterfeiting activity
of North Korea, illicit drug trade and counterfeiting, and
weapons of mass destruction. It would seem to me a good place
to start is by saying that, independent of any connection
between that illicit trade and weapons of mass destruction, it
would be a good idea for the United States and the
international community to do what it could to interdict that
trade. That, just on the face of it, would be a valuable
objective.
That said, though, going to the connection, this is a
source, as other witnesses have pointed out, of hard currency,
and apparently a significant source, and as such, since money
is fungible, these funds, undoubtedly, can be used to support
the North Korean military capability, including its ballistic
missile and nuclear weapons program and other weapons of mass
destruction.
So that if you needed an additional reason, the connection
to the threat posed by these weapons of mass destruction to the
United States and its allies, particularly South Korea and
Japan, would be one such.
However, it would seem to me the reverse, turning the
argument about, is not such a good idea. It does not seem to
make sense to offer the proposition that a good way to go about
stopping North Korea's nuclear weapons program, for example, is
by stopping or interdicting illicit drug and counterfeiting
activity.
It seems to me that the programs of North Korea are a very
high value to it in weapons of mass destruction, particularly
the nuclear weapons program, and if they value their fissile
material production, which now comes from existing spent fuel,
fuel that is being irradiated, from which plutonium can be
extracted, and an uranium enrichment program which will produce
enriched uranium, if funds are needed for these programs, they
will be found.
They may be found by extracting the funds from those funds
which are now used to support a very large conventional
military establishment. They may be found by the regime making
very brutal tradeoffs with requirements in the civilian sector.
So I do not see the relative cost of these programs, as
compared to other areas where they may be able to find funding,
to be such as to suggest that this interdiction of drugs and
counterfeiting would have the impact of preventing these
programs from going forward.
My principal concern, therefore, as I listen to arguments
about the importance of the drug and counterfeiting funds to
the North Koreans, is that there be a delusion, in a sense,
that we might be able to prevent the nuclear weapons program
specifically from proceeding by acting against these programs
which are, in and of themselves, reprehensible.
It seems to me that we are now facing essentially the same
three choices that we faced a decade ago if we wish to stop the
nuclear weapons program in North Korea and stop that program
specifically.
Those three choices were, and are:
First, the use of force, with all that implies, in terms of
horrendous casualties, were we to do that;
Second, to contain North Korea, which is another way of
saying to accept the North Korean nuclear weapons program, and
that option or that choice would entail, first, accepting the
risks, which I think are quite high, that South Korea and Japan
might eventually follow suit and acquire nuclear weapons. I
think the risks are quite high that their ballistic missile
program would eventually be mated with the nuclear weapons
program, and those missiles would eventually be capable of
reaching our West Coast;
And, finally, and I think most significant of all, there is
the possibility that North Korea might export and sell this
fissile material to terrorists. I guess I would take issue with
my colleague, Dr. Wortzel, here. I would think this is the
overriding priority. I cannot myself think of a more important
objective for the national security, the homeland security of
the United States of America, than making sure that fissile
material does not fall into the hands of terrorist groups.
So, finally, in the three options, the third one is left,
and that would be to negotiate with the North Koreans, to see
at least whether it was possible to negotiate a verifiable end
to the nuclear weapons program, in other words to test the
North Koreans, who have said they are prepared to put their
nuclear weapons program on the table, test that proposition and
see if we could not negotiate the outcome we want. At least I
would do this before I would consider opting for either of the
first two choices.
There is, in other words, in my view, no free lunch here in
dealing with the North Korean problem, not by a process of
containment or not by a processing of hoping the Chinese will
solve the problem for us. I think the choices are the choices
we have always had.
The subject of this hearing, though, the drug trade and the
counterfeiting, are two concerns which are quite legitimate and
ought to be pursued, and the only concern I am presenting to
the Subcommittee today is that we not mistake that effort for
an effective policy of dealing with the nuclear weapons
program.
Thank you, Mr. Chairman.
Senator Fitzgerald. Dr. Gallucci, thank you very much.
You started your comments by saying that the world
community should interdict any illicit drugs that are being
shipped out of North Korea. How do we go about doing that?
Given that the North Koreans have a close relationship with
China, do we try to involve China? Do you think that is
feasible?
Mr. Gallucci. Mr. Chairman, we have come to the point, for
me at least, which I have to fess up that I am no expert in
drugs or counterfeiting. It does seem to me, though, that at
least individual states in the international community are
prepared to cooperate with us, when they think they are dealing
with ships that have illegal drugs aboard and perhaps
counterfeit currency.
I do not know that we can expect that we are going to get
full cooperation from the Chinese, particularly, in this area.
And I know one of my colleagues made this point, but if we are
hoping, for example, to in a sense quarantine the North Koreans
with a policy of bringing the rest of the international
community aboard, I think we have to ask ourselves whether the
Chinese would be willing to engage in a policy which we thought
was designed to bring the North Koreans to their knees; an
outcome which the Chinese I do not think really would find as
favorable as we would. So I think we have to wonder about the
extent to which they will cooperate with us.
But as to the real thrust of your question, what the
legalities of this would be, I really do not know, Mr.
Chairman. I am sorry.
Senator Fitzgerald. Dr. Eberstadt, you had some very
interesting statistics, and you came up with good possible
explanations for what could be funding the trade deficit that
we know North Korea has.
One other possibility is that they could be getting foreign
aid or they could be borrowing money that would enable them to
fund that large deficit. Are they getting foreign grants and
loans of a sizeable amount, that you are aware?
Mr. Eberstadt. During the period up to 2001, sir, yes, they
were getting foreign aid, including foreign aid from the U.S.
Government.
Senator Fitzgerald. And how much was the United States
providing?
Mr. Eberstadt. The Congressional Research Service has
estimated, between 1995 and 2001, total humanitarian, and heavy
fuel oil and medical aid from the USG to DPRK was a little bit
over $1 billion in total. So U.S. foreign aid, certainly, could
help to explain it.
Senator Fitzgerald. Are they getting loans from any
international funds like the World Bank or International
Monetary Fund?
Mr. Eberstadt. No, sir. Our restrictions and sanctions on
the DPRK----
Senator Fitzgerald. Block that.
Mr. Eberstadt [continuing]. Impel the United States to vote
against membership or such loans, and they are not receiving
them. DPRK does get a small amount of money from the U.N.
Development Program, but I think that is a few million dollars
a year.
Senator Fitzgerald. Dr. Wortzel, Mr. Bach from the State
Department testified that the State Department had sought
satellite imagery in 1996 and 1999, I believe he said, and that
the satellite imagery suggested no evidence of poppy
cultivation greater than a thousand hectares?
Mr. Wortzel. He said hectares, that is correct.
Senator Fitzgerald. Do you believe that?
Mr. Wortzel. No, I do not, Mr. Chairman. The Congressional
Research Service, again, in its 1999 report, put poppy
cultivation at somewhere between 3,000 and 7,000 hectares. And
I also do not accept----
Senator Fitzgerald. And what was the basis for them saying
that?
Mr. Wortzel. Well, I am sure it was imagery. I mean, it was
an unclassified report, but they based it on U.S. Government
surveillance.
I also do not accept the statement about ground truthing.
It has been a number of years since I had to, as a military
intelligence officer, deal with imagery and ground truthing,
particularly of agricultural things, but it seems to me that
the signature, whether it is in multispectoral sort of color
imaging of agricultural growth or in other forms of imagery,
the signature of poppies is the same all around the world. It
might differ slightly by the amount of moisture in it, but I
think we could do better.
Senator Fitzgerald. Dr. Eberstadt.
Mr. Eberstadt. Sir, I hope it is not churlish of me to
point out that if the U.S. Government were to determine
conclusively that the DPRK were cultivating more than a
thousand hectares of opium poppies, illicit opium poppies, a
year, the U.S. Government would consequently be obliged, under
the Foreign Assistance Act of 1961, to impose additional
economic sanctions against the DPRK, which is to say if one
were interested in promoting an ``engagement'' policy with the
DPRK, it would be highly inconvenient to determine if the DPRK
had a thousand hectares or more.
Senator Fitzgerald. Are you suggesting that the State
Department could be putting pressure on officials who make
those assessments to keep their findings under a thousand
hectares?
Mr. Eberstadt. I would simply suggest good lawyers do not
ask questions they do not like the answers to.
Senator Fitzgerald. Senator Akaka, would you have questions
of the witnesses?
Senator Akaka. I do have questions. Thank you very much,
Mr. Chairman.
Dr. Gallucci, you probably have the most experience of
anyone outside the government in negotiating with the North
Koreans. Do you believe that it is possible to reach a
verifiable agreement with them?
Mr. Gallucci. I believe it is possible, Senator. I believe
we, in 1994, concluded what is known as the agreed framework
which had a portion of it that was verifiable, and we were able
to verify that the plutonium program we were out to stop was
stopped and has been stopped, and because of that deal, there
are probably 100 or so less nuclear weapons on the face of the
Earth than there would otherwise be.
But the portion of the framework which was not subject to
verification, other than what we could do by, as we say,
national technical means, went to enrichment, and that is where
they cheated. So if you ask could we, in a sense, do another
deal, but this time make sure that the whole thing was
verifiable, I think it can be imagined, and I think it is
possible.
The question is whether the North Koreans would go for such
a deal, and I do not know, and I do not think anybody would
know until we sat down and tried to do it. We did not know last
time until we tried to do it.
Senator Akaka. I emphasized that because, in your
statement, you said that, of the three, that was possible, and
I just wanted to ask you about that again, and I thank you for
your statement.
We are concerned about North Korean reprocessing spent fuel
into plutonium. Do you think if we reached another agreement
with the North Koreans to end its nuclear program, do you think
we would still be able to account for what has been
reprocessed?
Mr. Gallucci. Senator, right now, that is a slightly more
complicated question than it was a few months ago. In 1994, the
intelligence community--our intelligence community--assessed
that North Korea, more likely than not, had one or two nuclear
weapons. That was based on an assessment that they had
reprocessed or could have reprocessed as much as 8 or 10 or so
kilograms of plutonium, in that range, in any case.
And so we had that assessment, and we did not, in the
agreed framework, provide for the immediate inspections that
would help us determine how much plutonium they actually had.
However, the framework does provide that the North Koreans
cannot get the major benefits of the deal, which were those two
large light-water power reactors. They cannot get even the
first bit of serious equipment for those reactors until they
come clean with the IAEA, and we settled that issue. So that
was part of the original deal.
Now, we have not gotten to that point in the construction
of the reactors, so we do not know what would have happened had
we gotten there. The deal has collapsed for other reasons right
now.
At this moment, the reason I said it was more complicated,
is because we have just heard that one of three things is true,
either the North Koreans have, as they said at one point, just
completed reprocessing the spent fuel, which they discharged
from the reactor and was in a pond which contains about 30
kilograms of plutonium, enough for perhaps five or six nuclear
weapons.
They may have already separated that plutonium or, as we
also heard from the North Koreans at another point, they are in
the process of separating that plutonium or, as we also heard
or might conclude, they have not yet started.
So I do not know that we know, and I cannot go much
further, on an unclassified basis, to talk about this, but what
we do know about this I think is inconclusive at this point.
Senator Akaka. Thank you. I appreciate your response. I
know it is touch and go, and I know you have had the kind of
experience that a few have had.
My time is almost up, Mr. Chairman, but I would like to ask
Dr. Wortzel a question.
I want to tell you that I share your frustration for
negotiating with the North Koreans, and I agree that we must
also negotiate multilaterally. And I also should tell you that
I do not share your view that bilateral negotiations are a
mistake. I think there is room for that. The administration
just completed negotiations in Beijing that were essentially
bilateral, even though Chinese diplomats were present in the
room.
In your testimony, you mentioned North Korea's dependence
on China for fuel and for food. How long and how far do you
think China would go to use this dependence to force North
Korea to change its policy, and do you think China would do so
to the point of provoking a coup in North Korea?
Mr. Wortzel. Mr. Akaka, thank you for your question.
Senator I spent I guess just about 5 years as a military
attache inside China. I can say that in direct bilateral
negotiations with North Koreans on the prisoner of war missing
in action teams that the United States sent into North Korea,
they were not easy to work with, but you could negotiate with
them, you could reach an agreement. They kind of took you to
the cleaners financially, but they lived up to their agreement.
So there are times when you can do that. This is, obviously, a
much more sensitive issue.
As a military attache, I had the privilege of, at different
times, escorting not only the minister of Defense of China, but
the chief of their General Staff Department, the deputy chiefs
of their General Staff Department, at one time probably every
military region commander, at one time or another, at some
rank.
And I can tell you that, uniformly--in fact, one
conversation was, ``Wortzel, you are a military intelligence
officer. Report this back to your government. We will not let
the Government of North Korea collapse, period.''
Now, then we went into a very long discussion of what
measures one could take, and what if there was an implosion or
an explosion. I believe that is still the policy of the
People's Republic of China. They do not want to see a collapse.
They do not want to see the United States or South Korean
forces up on the border of China and the Yalu River. I do not
think they want to see a nuclear North Korea, necessarily,
either, mostly because of what it means for Japan.
China supplies somewhere between 70 percent and 88 percent
of North Korea's fuel needs. I believe oil for food was 12
percent. China supplies somewhere between 30 percent and 40
percent of North Korea's food needs. They can modulate that, as
they did for 3 days in November, I think it was. But I think
they are both the problem, and perhaps the key, to a solution,
and that is why I think it is very useful that however
diplomatic the facade was, that there were multilateral
negotiations in Beijing.
Senator Akaka. Thank you very much for your response.
Mr. Chairman, thank you.
Senator Fitzgerald. Well, I would like to thank the
gentlemen for appearing here before us. Your testimony was very
enlightening. I appreciate your efforts, and we will submit
your full statements for the record.
And with that, I would like to now call on panel 3 and ask
staff to make the necessary arrangements.
The Subcommittee will hear from two North Korean defectors
who have personal knowledge of and experience with a number of
the issues we have discussed today. Both witnesses have
requested that we protect their identities, and both witnesses
will have interpreters.
[Pause.]
Senator Fitzgerald. Our first witness is a former North
Korean high-ranking government official. He worked at a North
Korean Government agency for 15 years and has detailed
firsthand knowledge about drug trafficking and counterfeiting
by the North Korean Government. For reasons he cannot disclose
today, he defected to South Korea in late 1998.
The second North Korean defector is a former missile
scientist who is personally familiar with the manufacture,
programming and deployment of missile systems. As the head of
the Technical Department of a missile factory in North Korea,
Bok Koo Lee--that is an alias that he uses--will testify to his
personal knowledge of, and involvement with, the missile
program in the factory town where he worked between 1988 to
1997. Mr. Lee defected from North Korea in July 1997.
Gentlemen, thank you for being here today. You may proceed
with your opening statements, beginning with the first
defector, who is the former high-ranking government official.
TESTIMONY OF FORMER NORTH KOREAN HIGH-RANKING GOVERNMENT
OFFICIAL \1\ [THROUGH AN INTERPRETER]
Defector No. 1. Mr. Chairman and Hon. Senators, I am the
witness designated as the former North Korean high-level
government official to testify about the drug production and
trafficking by the North Korean regime. I would like to thank
you and the American people for your concerns and interests to
help save the North Korean people suffering under the worst
kind of one-man dictatorship in the past 50 years.
---------------------------------------------------------------------------
\1\ The prepared statement of former North Korean high-ranking
government official appears in the Appendix on page 70.
---------------------------------------------------------------------------
I worked at a North Korean Government agency for 15 years,
where I was able to get detailed and firsthand knowledge about
the drug trafficking by the North Korean regime. There are
reasons that I cannot really explain here, but, nevertheless,
for the reasons I cannot disclose, as I said, I defected to the
Republic of Korea in late 1998. I now live in Korea's capital
city of Seoul and work to help save the people whom I left
behind in North Korea.
Production and trafficking of illegal drugs by the North
Korean regime has been widely publicized for some years now.
Recently, concerning the seizure of 50 kilograms of heroin, on
a North Korean ship named ``Bongsu,'' by the Australian
authorities has confirmed again that North Korean regime has
been very busy making and selling the illegal drugs to other
countries in order to support the cash-strapped regime. North
Korea must be the only country, as far as I can tell, on the
entire globe to run a drug production trafficking business on a
state level.
North Korea started its production of drugs secretly in the
late 1970's in the mountainous Hamkyung and Yangkang Provinces.
North Korea began to produce and sell drugs in earnest
beginning in the late 1980's, and that is the time when Kim Il-
sung, of North Korea, who is the leader of that country, toured
Hamkyung-Bukdo Province and designated the area around Yonsah
Town in Hamkyung Province to be developed into an opium farm.
It was known that the Japanese colonial government also used
this area to grow opium, and Kim Il-sung told the people to
earn hard currency by growing and selling opium because he
needed cash.
The local party province committee developed an
experimental opium farm in Yonsah Town in secret, and the farm
was tightly guarded by the security police officers. They began
to produce opium at the collective farms located in towns like
Yonsah, Hweryung, Moosan, and Onsung in Hamkyung-Bukdo
Province. All opium produced, thus, produced in these farms
were sent to the government to be processed into heroin. They
called these opium poppies the broad bellflowers in order to
hide the operation from the general public, but this was an
open secret because everybody knew what that was all about.
North Korea had very little to export since the early
1990's because 90 percent of their factories became useless for
lack of raw materials and energy. They tried to export
mushrooms, medicinal herbs and fisheries to China, Japan and
South Korea. However, the only way to bring in large sums of
hard currency was to sell drugs to other countries and to
smuggle in used Japanese cars in turn.
In the late 1997, the Central Government ordered that all
local collective farms must cultivate, grow, for the area of
about 10 chungbo, that is, about 25 acres, of a poppy farm
beginning in 1998. The Chinese Government somehow learned about
this and then dispatched reporters and police officers to take
pictures of these farms near the border.
All opium thus produced are sent to the pharmaceutical
plants in Nanam area of Chungjin City in Hamkyung-Bukdo
Province. They are processed and refined into heroin under the
supervision of seven to eight drug experts from Thailand, and
this is all done under the direct control and strict
supervision of the Central Government.
I heard that there is another opium processing plant near
the Capital City of Pyongyang, but I have not confirmed this
myself. These plants are guarded and patrolled by armed
soldiers from the National Security and Intelligence Bureau of
North Korea. No outsiders are allowed in these facilities.
North Korea produces now two types of drugs: heroin and
methamphetamine, which is called in Korean, ``Hiroppon.'' They
produce these drugs one ton a month each. Heroin is packaged in
boxes, each containing 330 grams--that is about 11.6 ounces--of
heroin, and those boxes have a Thai label. Methamphetamine is
packaged in boxes each containing about 1 kilogram of the
substance, but has no label.
In China, near the border, the drugs are sold for $10,000
per kilogram. And through the ocean on board, these drugs are
sold for $15,000 per kilogram. North Korea sells these drugs,
through the border with China, to China or, through the seas,
Hong Kong, Macao, Russia, Japan, Russia, even South Korea. They
also deal with the international drug dealers on the Yellow Sea
and Eastern Sea. Their major markets are, of course, Japan.
It has been no secret that the North Korean regime has used
its diplomats and businessmen for drug trafficking, using all
means possible. In November 1996, a North Korean diplomat who
was stationed in Moscow, Russia, was caught by the Russian
border police. When he was caught, he had 20 kilograms of
illegal drugs with him. He later committed suicide in the
prison.
Things were desperate in North Korea. In December 2001,
South Korean authorities found a big shipment of illegal drugs
at the Port of Pusan, but South Korean authorities did not
identify the source of that drug shipment, but it was well
known, I have no doubt, that this shipment must have come from
North Korea.
I have a list of instances involving North Korean drug
trafficking as follows:
In July 1995, an agent of the North Korean National
Security and Intelligence Bureau was caught by the Chinese
police when he tried to smuggle in 500 kilograms of heroin.
In November 1996, a North Korean lumberjack working in
Russia was caught at Hassan Station with 22 kilograms of opium.
In May 1997, a North Korean businessman was caught in
Dandung, China, when he tried to sell 900 kilograms of
methamphetamine.
In July 1997, another lumberjack was caught in Havarovsk,
in Russia, with possessing 5 kilograms of opium.
In January 1998, two North Korean diplomats stationed in
Mexico were caught by the Russian police officers when they
tried to smuggle in 35 kilograms of cocaine.
And in July 1998, two North Korean diplomats stationed in
Russia [sic] were arrested when they tried to smuggle in
500,000 capsules of psychotomimetics, which is a kind of
stimulant.
It is my view, given the fact that North Korean regime is
confronting a very critical crisis and economic dire situation,
that short of international measures, strong and effective
measures on the part of the international community, North
Korea will continue, in my view, to produce and sell drugs.
North Korea is the only country on Earth that grows opium
poppy, processes it into heroin and sells them abroad. I,
again, would like to urge a stern measure on the part of the
international community to cope with this dire situation of
North Korea involving drug trafficking and selling.
Senator Fitzgerald. Thank you very much, Defector 1.
And now we will proceed to the second North Korean
defector. He is, again, a former missile scientist who is
personally familiar with the manufacture, programming, and
deployment of missile systems.
Thank you for being here, and you may proceed.
TESTIMONY OF BOK KOO LEE [ALIAS],\1\ FORMER NORTH KOREAN
MISSILE SCIENTIST [THROUGH AN INTERPRETER]
Mr. Lee. Thank you for inviting me to this hearing.
---------------------------------------------------------------------------
\1\ The prepared statement of Mr. Lee appears in the Appendix on
page 73.
---------------------------------------------------------------------------
My name is Bok Koo Lee. I defected from North Korea on July
21, 1997. Between 1988 until July 1997, that is, 1988 until
July 1997, I worked at Munitions Plant No. 38 in Huichon,
Jagang Province, North Korea. There are 11 subplants at this
munitions complex, also known as Chungnyon Jeonghi Yonkap
Kiupso, meaning Youth Electric Combined Company. Among the 11
subplants, Nos. 603 and 604 produced and assembled missile
parts. The parts we produced are all electronics. I held the
position of head of Technical Department at Subplant 603 until
I left North Korea in July 1997.
The responsibilities of the technical department are
assembly and development of parts for missile guidance control
vehicle, as well as developing the software. The missile
launching units are made up of these control vehicles and the
transport vehicles.
In the interest of time, I would like to talk mainly about
one of my experiences on this missile guidance control vehicle.
In the summer of 1989, as we were ordered by the Second
Economic Committee, which controls all munitions industry in
North Korea, I, together with five colleague engineers of mine,
went to the Nampo military port in Nampo City, South Pyongyang
Province.
When we arrived at Nampo, a cadre from the Second Economic
Committee greeted us and issued camouflage uniforms for the
military, and we changed into them before we boarded a ship.
Since we were locked under the deck and could not see outside,
I do not know exactly how long, but the voyage seemed to have
lasted about 15 days, according to our eating and sleeping
pattern.
When we docked at a port, we went to the stern of the ship,
and there we found and boarded a missile guidance control
vehicle that we built in North Korea. I knew then and there
that we were about to test launch a missile. With the windows
of the vehicle blocked, we traveled for about 2 days inside
this missile guidance control vehicle before it stopped, and
our military commander told us to be ready for battle.
So we opened the windows and the back door, too, in order
to connect the power supply. That is when I heard someone's
voice from outside, and when our commander walked up to him, I
could see that the man was an Arab. ``I must be in an Arab
country,'' I thought.
About 10 minutes later, the commander yelled, ``Storm,''
which is the battle order in North Korea. Each of us took up
his position inside the vehicle to man this equipment, and then
we put it ready in sequence. In a few minutes, the commander
gave us the order to launch, and we transmitted the launch
signal.
About 20 minutes afterwards of transmitting guidance
control signals, the commander relieved us of our duties. Since
the missile was not nearby, we could not see. And when the
launch was over, we left in a hurry, leaving our control
vehicle there, and rode another military vehicle to come back
to the ship we were on.
The next morning, the ship began its journey back to Nampo,
which also took about 15 days. From there, we rode on a bus
from Nampo to arrive at an annex building of the Party Central
Committee in Pyongyang. The routine debriefing took as long as
15 days. We did not have much to report, but the debriefing of
our superiors took 15 days.
When the debriefing was over, Kim Chol Man, then chairman
of the Second Economic Committee, gave us some gifts,
complimenting our mission, which he said was to Iran.
After our return to the plant, I learned from Lee Byung Su,
the chief engineer in charge of Technical Improvement, that Yon
Hyong Muk, then-Premier of North Korea, accompanied us to Iran,
and he brought back to North Korea 220,000 tons of crude oil.
These 220,000 tons of crude oil was taken by the military with
the order of Oh Jin-u, the head of Armed Forces. And when the
fact was revealed to Premier Hyong, he had a big fight with Oh
Jin-u before Kim Il-sung about this, and he ended up taking
back some of the oil from the military.
After our trip, Subplants 603 and 604 began producing the
same missile guidance control vehicles as we took to Iran.
Since then, we produced nine such vehicles over a few years and
exported them to Arab countries. Or course, we also produced
and still produce, I believe, parts for other short- and
medium-range missiles.
Additionally, I would like to testify on the participation
of North Korean missiles during the first Gulf War of 1991, the
removal and relocation of Yongbyon nuclear facilities to
somewhere else, and about the Kumchang-ri Cave during the
closed session.
One final thing I would like to stress in this hearing is
the fact that in order to bring about the collapse of North
Korean regime, the munitions scientists like myself, in and
outside of North Korea, must be aware of the existence of safe
harbors in the West which will take them. Then, more scientists
will escape North Korea to seek asylum and the production of
weapons of mass destruction, such as nukes and missiles, will
be severely curtailed, eventually to the point where there is
no more people left to push that nuclear button.
It has been so long since the loyalty to Kim Jong-il by
North Koreans have collapsed. If one sings well, there is an
ample reward. Whereas, the scientists, like myself, will get
mere briefcases, ballpoint pens and Kim Jong-il's monologue for
their achievement. Therefore, no one hardly strives to develop
new things any more, but just occupies the desk.
We urge you to mobilize the international community and do
this to precipitate the collapse of North Korean regime.
Thank you very much.
Senator Fitzgerald. Well, thank you both for testifying,
and thank you for your courage in making yourselves available
to this Subcommittee.
I want to start with Defector 1. Our State Department
witness said that we do not have any satellite evidence of
poppy production in North Korea. Based on what you know about
North Korea's cultivation of poppy, is there a reason why we
could not see the poppy fields with our satellites?
Defector No. 1. It is surprising to me that satellite
pictures could not catch, satellites could not catch the poppy
farms in North Korea because, as I said earlier, since 1998,
there were all poppy farms about 10 chungbo, I think it is
about 30-some acres, was put aside for the sole purpose of
cultivating poppies only. And Chinese police officers and
Chinese reporters came to the border, and they took the
pictures of these farms. I am just flabbergasted that
satellites or the United States could not have access of this
or ascertained this kind of agricultural activity growing
poppies.
Senator Fitzgerald. The poppy fields that you described,
did you personally see those poppy fields?
Defector No. 1. Yes, numerous farms myself, with my naked
eyes.
Senator Fitzgerald. Were you personally involved in
trafficking heroin, as a high-ranking officer of the North
Korean Government?
Defector No. 1. Yes, there was a time I was directly
involved in the trafficking, the drug trafficking myself, and I
am confident that the drugs seized, after North Korean Ship
Pong Su was seized by the Australian authorities, I am sure
those drugs are North Korean products.
Senator Fitzgerald. Were you directed by your superiors in
the North Korean Government to traffic in the drugs you
trafficked in or were you doing that on your own?
Defector No. 1. There is nothing in North Korea a person
can do voluntarily to help the regime. And especially speaking
of production and selling, trafficking drugs, and processing or
growing poppies and processing poppies into heroin, these are
all done on the state level, as a state business, and they do
this as a means of acquiring or earning, as they say, hard
currency.
Senator Fitzgerald. So was it your job, working for the
North Korean Government, was it part of your official duties to
traffic in drugs?
Defector No. 1. Well, there are several reasons. I cannot
really specify here, especially about certain things I did
myself, but I can tell you this much. I can assure you that
production, the sale and trafficking of the drugs is done, it
is not because somebody wants to get involved in that kind of
business, but they are told to do so. Therefore, they are doing
it, and they are told directly by the highest authority in
North Korea, the one who has most power.
Senator Fitzgerald. So it is safe to conclude, from your
testimony here today, that the North Korean Government is in
the business of producing and trafficking in drugs like heroin.
Defector No. 1. Yes, sir, my answer is positive. Of course,
that was the situation, and North Korean regime, since mid
1970's, when its economy or economic situation started
deteriorating, they started growing and trafficking drugs as a
part of national policy, and it has been that way even today.
Senator Fitzgerald. Do you have any idea how many people
the North Korean Government employed in its drug production and
trafficking business, at least while you were there?
Defector No. 1. Well, I can tell you that at least 30
people that I personally knew were involved in trafficking,
drug trafficking and selling drugs, just to give you this as an
example, what limits I have, directly had. I am just curious
this thing that is the fact that the highest, most powerful
authority in North Korea have his people to engage in
production and trafficking drugs, it is not known to the United
States or the international community. Because of the absolute
power that North Korean leader has, anything is possible, as
far as he is concerned.
Senator Fitzgerald. Well, Defector 1, thank you very much.
That has been very powerful testimony.
I would like to ask some questions of Mr. Lee.
Mr. Lee, based on your personal experience and knowledge,
does North Korea currently have nuclear weapons?
Mr. Lee. I am not a nuclear scientist, so I cannot give you
``own hand'' response, but I do believe there are nuclear
weapons in North Korea.
Senator Fitzgerald. Mr. Lee, you testified in detail about
your own mission to a country that you believe was Iran to do a
demonstration of a North Korean missile. Are you aware,
personally, of other such missions, and do you know to what
countries those missions have been?
Mr. Lee. Yes, I do.
Senator Fitzgerald. You indicated to my staff that the
North Korean missile industry depends entirely on foreign
imports. Can you go into greater detail about that dependence
on foreign imports?
Mr. Lee. I worked for 9 years as an expert in the guidance
system for North Korean missile industry, and I can tell you
definitely that over 90 percent of these parts come from Japan.
And the way they bring this in is through the Chosan Sur [ph]
and the North Korean Association inside Japan, and they would
bring it by ship every 3 months, and we would go out to the
port, at times, when we are in a hurry and pick them up
ourselves.
Senator Fitzgerald. Were those parts smuggled from Japan
into North Korea or did North Korea purchase those parts?
Mr. Lee. I am sure it is informal. The ship that is used to
ferry these parts is called Man Gyong Bong, and this is a
passenger ship. It is not a freighter, so it is the smuggling.
Senator Fitzgerald. Mr. Lee, do you have any information on
North Korea's nuclear program and the Yongbyon nuclear
facility?
Mr. Lee. I do not have profound knowledge about the North
Korean nuclear development structure, but I was nearby when
there was this issue about IAEA inspection a long time ago.
Senator Fitzgerald. Mr. Lee, you were a scientist in the
missile program. As a scientist in the missile program, were
you at all aware of the country's trafficking in drugs, as
testified by Defector 1? Did you have any knowledge of that?
Does that come as a surprise to you or do you believe that
testimony?
Mr. Lee. I knew already that from 1999 the collective farm
had certain parcels allocated for the poppy cultivation. Each
collective farm had to cultivate poppies.
Even in the area where I worked, where the Munitions Plant
No. 38 is located, they developed a poppy field in Oh Su Dong
[ph], Joongang Gun [ph], Jagang Province, from 1994. To do
this, 2,000 reserve military was mobilized, and they were put
in to cultivate, to develop the poppy field. And because they
lacked the housing, we were also mobilized to build housing for
these reserve servicemen who were put in to develop the poppy
fields.
When I left in 1997, through that route in that
neighborhood, I could see the poppies were growing there. I
could see the poppy fields. In the fall, when they usually
harvest these poppies, they would use the students, and when
they do this, they would send the students in, and when they
are done, they would frisk them with only briefs on so that
there is nobody would take away these poppies.
Senator Fitzgerald. I just want to be clear on that. You
recall 2,000 military personnel being directed to work on
growing poppies?
Mr. Lee. The servicemen who have just been discharged.
Senator Fitzgerald. So they were men who had been
discharged? They were put to work----
Mr. Lee. As soon as they were discharged, they were put to
work to develop these poppy fields.
Senator Fitzgerald. And then students were used to harvest
them?
Mr. Lee. To harvest them, yes, that is correct, sir.
Senator Fitzgerald. Well, gentlemen, thank you very much
for this testimony. At this point, I would like to ask you both
to stay there. We are going to go into our closed session now.
As I previously announced to the audience, I would now ask
that the Capitol Police and security staff prepare the hearing
room for a closed session. I also ask that members of the
audience and the media please leave the room at this time.
As a reminder to Senate staff, this closed session will be
conducted at the unclassified level.
[Whereupon, at 5:01 p.m., the open Subcommittee meeting was
adjourned.]
A P P E N D I X
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