In recent years, Members of Congress have monitored the course of North Korea-Japanrelations because Japan plays a potentially critical role in addressing the military threat posed byNorth Korea, particularly its nuclear weapons program. (1) Most important, Japan has told North Koreait is prepared to offer a large-scale economic aid package -- on the order of $5 billion - $10 billion-- to compensate for the Japanese occupation of the Korean Peninsula from 1910-1945. During theAugust 2003 six-party talks in Beijing among North Korea, the United States, South Korea, China,Japan, and Russia, the Japanese delegation reportedly reiterated its position that significant aid wouldbe forthcoming if North Korea abandoned its nuclear program and cooperated on the issue ofJapanese citizens kidnapped by North Korean agents in the 1970s and 1980s. Japan also is important to the North Korean situation because it is a significant source of North Korea's foreign exchange. Not only is Japan North Korea's third-largest trading partner, but theJapanese market also is a major destination for the North Korean government's suspected drug-running operationsand of remittances from Korean permanent residents in Japan. Congress also has an interest in Japan-North Korea relations because Japan's bilateral issues with North Korea influence U.S. policy. The United States has long cited Pyongyang's harboringof Japanese Red Army terrorists -- who face charges in Japan of hijacking a plane in 1970 -- as areason for North Korea's inclusion on the U.S. terrorism list, which by law prohibits North Koreafrom receiving many forms of U.S. economic assistance and some trading rights. (2) At Japan's urging,the United States reportedly also has linked delisting to North Korea's cooperation with Japan onthe abduction issue. Finally, Japan arguably has been the strongest supporter in East Asia of the Bush Administration's policy of pressuring North Korea to abandon its nuclear program. Although Japanshares the objections of other regional states to the use of preemptive military force, it is morewilling than China, South Korea, and Russia to employ coercive diplomatic measures againstPyongyang. Japan's position thus is important to the U.S. effort to deal with the North Koreannuclear program multilaterally, rather than bilaterally (U.S.-North Korea exclusively), as NorthKorea had insisted. Indeed, since the late 1990s, the rising perception of the North Korean threat hasprompted and enabled Japanese leaders to broaden substantially the country's security posture. (3) On September 17, 2002, Japanese Prime Minister Junichiro Koizumi and North Korean leader Kim Jong-il held a one-day summit in Pyongyang that momentarily restarted normalization talksbetween the two countries, which had been stalled since November 2000. Koizumi and Kim signeda short document called the "Pyongyang Declaration." Kim pledged conditionally to unilaterallyextend his country's moratorium on missile testing beyond 2003 (when it was to expire), admittedthat North Korean agents had kidnapped 13 Japanese in the 1970s and 1980s, and issued a vaguepromise to comply with international agreements related to nuclear issues. Koizumi, in turn,apologized for Japan's colonization of the Korean Peninsula and offered to provide North Koreawith a large-scale economic aid package, much as it gave South Korea economic assistance whenTokyo and Seoul normalized relations in 1965. At the time, Koizumi's trip to Pyongyang was a significant departure from Tokyo's increasingly hard-line stance toward North Korea and had the potential to put Japan at odds with the BushAdministration's policy. For most of the late 1990s, Japanese policymakers sought to move slowlyand deliberately on normalizing relations with North Korea, due to the launch of a long-rangeTaepodong Missile over the Japanese Islands in August 1998, Pyongyang's development anddeployment of medium-range Nodong missiles capable of reaching Japan, new revelations about theabductions of Japanese citizens by North Korean agents, and incursions by North Korean espionageand drug-running ships into Japanese waters. This cautious approach often created tension betweenTokyo and the Clinton Administration, which, along with South Korea's Kim Dae Jung, pursued apolicy of engaging North Korea in the late 1990s. During this time, Japanese policymakers oftenappeared torn between a desire to avoid becoming isolated from U.S.-South Korea-North Koreadiplomacy and domestic pressure to proceed cautiously. (4) (5) This dilemma was relieved whentheBush Administration came into office in 2001 and pursued a policy of using public accusations andwarnings to pressure North Korea to allow international inspections of its nuclear facilities and agreeto verifiable curbs to its missile program, including missile exports. (6) The Japan-North Korea normalization talks and parallel security talks stalled due to two developments shortly after the Koizumi-Kim summit: North Korea's October 2002 admission toU.S. officials that it has a secret nuclear weapons program based on the process of uraniumenrichment; and popular outrage in Japan at Kim Jong-il's admission that North Korea hadkidnapped 13 Japanese, eight of whom the North Koreans said had died since their abductions. Prime Minister Koizumi has said normalization talks will not continue unless Pyongyang cooperateson the abduction issue and begins dismantling its nuclear program. Also, in October, the five knownsurviving kidnapees traveled to Japan for a one-to-two week visit, but were not permitted to bringtheir children -- some of whom do not know their parents are Japanese -- or spouses with them. The ensuing public outcry that these relatives were being held as "hostages" led Koizumi to refuseto send the five back to North Korea and to demand that family members be allowed to come toJapan. (7) (One complicating factor is that the husbandof one of the five is an American militarydeserter living in North Korea.) The five continue to live in Japan, and reportedly have taken steps,such as finding jobs and buying property, to reintegrate into Japanese society. On October 29, 2002, Japan and the DPRK held normalization talks in Kuala Lumpur, Malaysia. The Japanese delegation reportedly told the North Korean side that normalization -- andtherefore, discussion of economic assistance -- would not proceed until Pyongyang agrees to sendthe children of Japanese abductees to Japan and halt its nuclear weapons program. Japanesenegotiators also requested that the North dismantle its medium-range Nodong missiles. North Korea,accusing the Japanese side of breaking with the Pyongyang Declaration, made no concessions, andthe meetings ended with no joint statement. Subsequently, a North Korean Foreign Ministryspokesman warned that if bilateral talks stall over the nuclear issue, Pyongyang may reconsider itsmissile moratorium. Separate bilateral discussions of security issues, which were to have begun inNovember 2002, have yet to be held. Throughout 2003, the two countries have held several officialand unofficial discussions about resolving the kidnapping issue and restarting the normalizationtalks. In the Pyongyang Declaration, Japan and North Korea promised to "abide by all relevant international agreements in order to comprehensively resolve the nuclear issue on the Koreanpeninsula." Koizumi reportedly had insisted on including this in the declaration after being briefedon U.S. intelligence indicating that North Korea's clandestine uranium enrichment program wasmore advanced than had been thought previously. The international agreements presumably includethe 1992 North-South Korean Denuclearization Declaration, which prohibits the possession ofuranium enrichment facilities, the 1992 nuclear safeguards agreement with the International AtomicEnergy Agency (IAEA), and the 1994 U.S.-DPRK Agreed Framework, which committed NorthKorea to freezing its plutonium nuclear program. (8) Since the revelations about North Korea's uranium nuclear program were made public in October 2002, Japan has been the Northeast Asian country most supportive of the BushAdministration's policy of combining multilateral dialogue and pressure to convince North Koreato abandon its nuclear program. At President Bush's side later that same month, Prime MinisterKoizumi stated that full normalization could not take place until after the nuclear issue wasresolved. (9) In mid-November 2002, Japan voted withthe United States, South Korea, and theEuropean Union to suspend shipments of heavy fuel oil to North Korea. The oil was being providedunder the 1994 Agreed Framework, ostensibly to compensate Pyongyang for the energy it lost fromshutting down its plutonium nuclear reactors. Japanese policy hardened further in the aftermath of the April 2003 trilateral U.S.-North Korea-China meeting in Beijing. The following month, during a bilateral summit in Crawford, Texas,Koizumi agreed with Bush that a policy of "dialogue and pressure" should be used peacefully toinduce North Korea to give up its nuclear program. Koizumi also declared that Japan would "crackdown more vigorously" on illegal activities involving North Korea or ethnic Korean supporters inJapan and would take "tougher measures" if North Korea escalated the situation. Japan is one ofeleven countries participating in the U.S.-led Proliferation Security Initiative, announced byPresident Bush in May 2003, which is designed to interdict weapons of mass destruction shipmentsto and from countries of proliferation concern, such as North Korea. Concurrently, since early 2003, the Japanese government has toughened enforcement of its controls on the export of potential dual-use items to North Korea and has announced a newinterpretation of domestic foreign exchange laws that would make it easier for Tokyo to cut offbilateral trade and shut off the flow of remittances from ethnic Koreans to their relatives in NorthKorea.