ACCESSION NUMBER:382159 FILE ID:PO1302 DATE:03/08/95 TITLE:STATE DEPARTMENT REPORT, WEDNESDAY, MARCH 8 (03/08/95) TEXT:*95030802.PO1 STATE DEPARTMENT REPORT, WEDNESDAY, MARCH 8 (WTO director general, Korea, Croatia) (610) NEWS BRIEFING -- Acting spokesman Christine Shelly discussed the following topics: ALLEGATION ABOUT WTO CANDIDATE SAID WITHOUT BASIS Responding to a question, Shelly said an allegation reported in the March 7 Journal of Commerce concerning former Italian Trade Minister Renato Ruggiero, a candidate for World Trade Organization (WTO) director general, "appears completely without basis." Claiming that the U.S. government has intelligence which is damaging to Ruggiero's candidacy, the Journal of Commerce said he was accused of helping some Italian companies escape reprisals for evading the U.N. trade embargo against Iraq. While reminding reporters that "we don't comment on intelligence reports," Shelly added, "I can say that the allegation...appears completely without basis. We do not approve of any attempt to affect the reputation of individuals by leaks and innuendos." "We have full respect for those who have offered their candidacies as international public servants in the WTO," she said. "As to the general issue regarding the filling of that position, the U.S. is continuing to look at all options. We have not endorsed or rejected any candidate for the WTO director general's position. We do feel strongly that the decision on the WTO DG position should be made by consensus." NORTH KOREAN OBJECTIONS TO REACTOR SAID NOT COINCIDENTAL The acting spokesman said North Korea's continuing public objections to a South Korean model light water reactor (LWR) are probably not coincidental. Commenting on Pyongyang's statement in Geneva March 8, Shelly said, "We've seen the report. As you know, the KEDO (Korean Energy Development Organization) talks start today in New York, so the timing on this is probably not just coincidental." The United States, South Korea and Japan were instrumental in forming the multinational Korean Energy Development Organization which will provide LWR technology to North Korea in return for Pyongyang's commitment to freeze 1ts nuclear program under the U.S.-North Korean agreement signed last October. "Our position on this remains exactly as it was," Shelly emphasized. "There is no alternative" to the South Korean reactors. The United States believes that KEDO "will determine that the light water reactor should be and will be of the Republic of Korea model, which is the only viable option as far as we, and I believe the rest of the international community, see it," she said. CONTINUED INTERNATIONAL PRESENCE IN CROATIA DISCUSSED The acting spokesman said there are indications that Croatian authorities have been discussing "ideas related to a continued international presence" in Croatia, despite President Franjo Tudjman's announcement that he wants the United Nations Protection Force (UNPROFOR) to withdraw when its current mandate expires on March 31. Shelly's comments were prompted by questions about the visit to Zagreb earlier this week by Richard Holbrooke, assistant secretary of state for European and Canadian affairs. Holbrooke met with Tudjman, Croatian cabinet officers and United Nations officials. She rejected media reports that suggested Holbrooke's mission was a failure. "We believe that progress has been made on issues of concern to all sides on this. No final decisions have been reached, and we have every expectation that the discussions on this will continue." Citing other reports from the region and from U.N. sources, she said "there are some indications that Croatian authorities...have been discussing ideas related to a continued international presence there." Shelly said the United States has discussed Holbrooke's trip with its partners in the five-nation Contact Group and will be consulting at the U.N. Security Council within the next couple of days on options that are available and steps that should be taken. NNNN .