China - S.Korea to Participate in Mobile Phones and Insurance

In a significant move toward strengthened ties, President Kim Dae-jung and Prime Minister Zhu Rongji of China agreed Wednesday that South Korean companies can participate in developing mobile phones and the insurance business in China, a presidential spokesman said.

They also agreed to seek agreements on a high-speed railway, nuclear power technology, petrochemicals, coal, steel and the environment.

The two leaders' 95-minute talk at the Blue House also touched on rapidly warming developments between North and South Korea following the June summit meeting in Pyongyang.

"The two sides agreed to allow South Korea to have the opportunity to participate in China's CDMA market and for South Korea to open an insurance company in China," said a Blue House spokesman, Park Joon-young. CDMA, or code division multiple access, is a technical standard used primarily in South Korea for cell phones.

With Korea's participation in China's large mobile phone market, Korean firms are expected to make big profits.

Mr. Park said the talks during Mr. Zhu's visit will contribute to elevating Korean-Chinese relations in "all areas," not only limited to economic ties.

Analysts said China's quest for an active role in Korea seemed to be reflect the rapid movement by the North and the United States toward broad talks. Some 40 U.S. officials traveled to Pyongyang on Tuesday to pave the way for a visit by U.S. Secretary of State Madeleine Albright this month. If her visit ends successfully, Bill Clinton may become the first U.S. president to visit North Korea, according to a U.S.-North Korea communique last week.

"China hopes to maintain its position and influence on North Korea. The rapid talks between Pyongyang and Washington obviously concern China, which has sought to improve ties with North Korea since their relations deteriorated in the early '90s following China's establishment of diplomatic ties with South Korea," Park Doo-bok, a professor at the Institute of Foreign Affairs and National Security, told the JoongAng Ilbo English Edition. A foreign affairs source added that with relations between Washington and Pyongyang improving, China seems to be making a calculated move toward South Korea.

Mr. Zhu arrived in Seoul on Tuesday for a three-day visit, his first since the two countries opened diplomatic ties in 1992. He also met Korean business leaders on Wednesday.

As well as increasing its trade relations with China, South Korea wants China, the North's only communist ally, to play a role as a mediator along the United States in the four-party talks aimed at a peace treaty with the North. The 1950-1953 Korean War ended in a truce, and not a peace treaty.

Mr. Zhu plans to join other world leaders at the Asia-Europe Meeting in Seoul on Friday and Saturday.

In another sign of cooperation on Wednesday, the two countries' foreign minsiters signed a criminal extradition agreement.

by Kim Jin