Chun Yung-woo made the statement after six-party talks, involving Russia, North and South Korea, the United States, Japan and China, recessed in Beijing Thursday over delays in transferring North Korea's $25-million in the Macao Bank, which the U.S. had frozen on money laundering suspicions.
"North Korea wants the money to be transferred to its accounts in Russian banks," Yung-woo said.
Despite unfreezing the accounts, Washington banned U.S. financial organizations from dealing with the Macao Bank as money laundering suspicions persisted. With that in mind, the Bank of China refused Wednesday to transfer the money for fear of similar U.S. sanctions.
Chinese negotiators proposed Thursday transferring North Korea's money to a South Korean bank, which has a branch in the Communist nation. But Yung-woo said Friday South Korean banks had no North Korean accounts, and therefore could not mediate the transfer.
Russia's chief negotiator on North Korea, Alexander Losyukov, warned Russian banks Thursday against transferring the money.
"I would not recommend any Russian bank or organization to handle such transactions," he said, calling on the U.S. to provide guarantees that no sanctions or restrictions would be imposed on a bank from a country involved in the mediation.
A source close to the talks said Friday China would handle the transfer as a country hosting the six-party negotiations, which have been ongoing since August 2003.
"The issue will be addressed by China together with the American side," the source said, adding that the March 19-22 talks in Beijing had stalled because delegations included no financial specialists who could have foreseen the problem.
Pyongyang returned to the negotiating table last December after conducting its first nuclear bomb test in October, a move that triggered UN sanctions. The six negotiating nations reached a breakthrough deal February 13 to make Pyongyang close down its nuclear facility in exchange for unblocking its accounts.
