Bush accuses North Korea of blackmail after talks fail

As President George Bush accused North Korea of blackmail yesterday, his administration was weighing with allies in the region the next move in the ever-deepening confrontation with Pyongyang over its nuclear ambitions.

In his first comments on three days of apparently unproductive talks between American and North Korean representatives in Beijing this week, Mr Bush said the North was "back to the old blackmail game" with threats to develop more nuclear weapons unless the United States gave lavish aid and signed a formal non- aggression pact.

America would not be intimidated. "This will give us an opportunity to say to the North Koreans and the world that we're not going to be threatened," the President said in an interview with NBC television. But if Pyongyang's claims are true, Washington's room for manoeuvre is diminishing fast.

In the Beijing meeting, the North Korean delegate Ri Gun is said to have told James Kelly, US assistant secretary of state, that not only did Pyongyang possess nuclear weapons – something long assumed by the CIA – but that it had already reprocessed all 8,000 spent fuel rods at its Yongbyon nuclear complex. If true, this would mean the North is poised to add another six or more weapons to the one or two the CIA believes it now has.

Many diplomats say the Kim Jong Il regime may be bluffing, given that US surveillance has picked up no evidence of substantial reprocessing, or any clue to an impending North Korean nuclear test which, according to some accounts, Mr Ri indicated might happen soon. They believe Pyongyang might be stepping up the pressure to sound out US intentions before offering concessions. But if these diplomats are wrong, then the moment is fast approaching when the American strategy of inducing Pyong-yang to abandon its weapons programme will be overtaken by events. Mr Bush gave no indication in his interview of his next step.

The administration is officially committed to a diplomatic solution, but Colin Powell, the Secretary of State, said this week that "every option" was on the table, a signal that Washington had not ruled out the use of force.

After a cursory closing session yesterday, Mr Kelly travelled to South Korea and Japan, to brief those governments on the talks, in which neither side appeared to have moved from its entrenched position.

Washington officials refuse to use the word "breakdown". They note that the two countries had agreed to further discussions, albeit at a time and a level yet to be set. But a crucial decision is moving closer for Mr Bush: whether to follow the example of Bill Clinton and engage with North Korea, or tighten the diplomatic and economic isolation of the regime.

The latter course would make North Korea's nervous neighbours even more edgy. Japan, which is within range of Pyongyang's missiles, reiterated yesterday that it wanted talks to continue. "Very few people in the US understand North Korea," a Japanese official told Reuters. "The possibility for miscommunication is very scary."

The latest confrontation began six months ago, when North Korean officials told Mr Kelly that their country was pursuing a secret programme using enriched uranium. It then withdrew from the nuclear non-proliferation treaty and expelled UN monitors from Yongbyon, before saying it was about to start reprocessing the fuel rods.