N. Korea purge sparked by mineral disputes: Seoul official

Seoul (AFP) - The shock purge and execution of the North Korean leader's uncle stemmed from his attempts to take control of the country's lucrative coal export business, South Korea's spy chief told lawmakers Monday.

Jang Song-Thaek, the once-powerful uncle and political regent to young leader Kim Jong-Un, was executed on December 12 on charges which included plotting a coup and corruption.

The execution -- the biggest political upheaval since Kim took power two years ago -- sparked speculation that Jang had lost out in a power struggle with hardline army generals.

But Nam Jae-Joon, the head of South Korea's National Intelligence Service, said Jang's attempts to secure control of state-run natural resources businesses played a big part in his downfall.

Nam, briefing members of parliament's intelligence committee on the situation in the North, also said the young ruler currently "appears to have no problem" in his grip on power -- but may stage armed provocations against the South sometime between January and March to rally domestic unity.

"Jang intervened too much in lucrative state businesses...related to coal, which drew mounting complaints from other (related) state bodies," lawmaker Jung Chung-Rae, a member of the committee, quoted Nam as saying at the closed hearing.

Jang for years handled the country's mineral exports, which go mostly to China.

The impoverished but mineral-rich North has sought for years to bolster its crumbling economy by increasing exports of coal and other minerals, which account for the bulk of its exports to China.
But Jang and his associates angered other top party officials by rapidly expanding their control over the coveted mineral businesses, Jung quoted Nam as saying.
"Kim Jong-Un was briefed about it... and issued orders to correct the situation," Jung told reporters.

But many officials loyal to Jang did not immediately accept his orders, which eventually led an angry Kim to launch a sweeping purge, the lawmaker quoted the spy chief as saying.

The regime is currently probing officials in the ruling party's administrative department once supervised by Jang as well as other state-run trading arms, Nam was quoted as saying.

"The North is now trying to erase any traces of Jang...partly by recalling many of his relatives and associates who lived overseas," Nam said.

Kim's powerful aunt -- Kim Kyong-Hui -- currently showed no sign of serious illness, Nam said, adding she appeared to be shunning public appearances for a while due to the execution of her husband.

Jang's execution raised questions about factional infighting at the top of the Pyongyang hierarchy and prompted both Seoul and Washington to warn of possible provocative acts by the nuclear-armed state.

Jang had been seen as Kim's political mentor, but the 67-year-old's growing political influence and power was increasingly resented by a leader barely half his age, analysts said.

About 88 percent of North Korea's total foreign trade last year involved China, according to figures earlier this year from the South's Korea Trade-Investment Promotion Agency.

It said exports to China -- mostly coal and iron ore -- were worth $2.4 billion in 2012.

South Korea estimates the total value of all mineral deposits in the North at 6.3 trillion dollars.