US ACCUSES N KOREA OF LINKS TO NARCOTICS TRADE

The US has accused North Korea of operating a multi-million-dollar
narcotics industry, with diplomats used to sell heroin and
amphetamines overseas.

A US military official in Seoul said that drug-trafficking had become
a crucial source of foreign currency for North Korea as the communist
country battles to save its crumbling economy from collapse.

The comments, made in a briefing to the Financial Times, were among
the most explicit US allegations to date that North Korea is involved
in international crime.

"This is state-controlled drug-trafficking. The military grows the
drugs and diplomats sell it overseas," said the US official.

Drugs-trafficking is the latest in a growing list of US allegations
against North Korea, which Washington has named as a rogue state
alongside Iraq and Iran in an "axis of evil".

North Korea admitted in October that it was developing nuclear weapons
and Washington has accused the state of exporting ballistic missiles
and committing human rights abuses.

The military official said Washington was convinced North Korea was
mass-producing narcotics worth an annual $100m and selling them in
Japan, Russia, China, Taiwan and South America.

The official, citing military intelligence, said North Korea had
become the world's third-largest producer of opium - after Burma and
Afghanistan - and the sixth-largest producer of heroin. Chemical-based
drugs, such as amphetamines, were also made in the country, he said.

The official said drugs had become one of North Korea's most valuable
export items since the country's industrial sector ground to a halt
following the collapse of the Soviet Union 10 years ago. Missile
exports worth about $560m a year were the country's biggest
fundraiser, he said.

North Korea's economy relies on foreign aid to save it from collapse.
However, international assistance has been cut in protest against the
country's nuclear weapons programme.

Last month, the US froze fuel shipments to North Korea and the United
Nations World Food Programme warned that 6.4m North Koreans could
starve next year because of a drop in food aid.

Against this backdrop, North Korea would increasingly rely on its
drugs and arms industries to survive, according to the US official.

In July, Taiwanese authorities seized 79kg of heroin that they thought
had been delivered to local smugglers by a North Korean naval boat.

A North Korean fishing boat sunk in a gun battle with Japan's coast
guard last December was also suspected of involvement in drugs
trafficking.

In August, a former high-ranking North Korean intelligence agent who
defected to Japan said that 3,000 hectares was set aside for poppy
cultivation in the north-eastern province of Yanggang in 1992.