Bush Moving N. Korea Off Terror Blacklist

President George W. Bush said he's lifting sanctions on North Korea and will move to take the country off the terror list -- a remarkable turnaround in policy toward the communist regime, which Bush once branded as part of an "axis of evil."

Bush did warn of further consequences if North Korea doesn't end its nuclear weapons activities.

The move came after North Korea handed over a long-awaited accounting of its nuclear work to Chinese officials on Thursday, fulfilling a key step in the denuclearization process.

Bush said the U.S. message to North Korea was, "We will trust you only to the extent you fulfill your promises. I'm pleased with the progress. I'm under no illusions. This is the first step. This isn't the end of the process. It is the beginning of the process."

"If North Korea continues to make the right choices it can repair its relationship with the international community ... If North Korea makes the wrong choices, the United States and its partners in the Six-Party Talks will act accordingly."

Specifically, Bush said the U.S. would erase trade sanctions under the Trading With the Enemy Act, and notify Congress that, in 45 days, it intends to take North Korea off the State Department list of nations that sponsor terrorism.

"We have no illusions about the regime in Pyongyang," said Bush, citing the communist government's human rights abuses and plutonium production for nuclear weapons. "Today we have taken a step, and it's a very positive step. But there are more steps to be done.

"The goal is a peaceful Korean Peninsula," he said.

A U.S. official says North Korea has agreed to intensive U.S. verification of its plutonium production for nuclear weapons. Secretary of State Condoleezza Rice, at a meeting in Japan, said North Korea must do more for political normalization.

North Korea has pledged to disable all its nuclear facilities and said it will destroy the cooling tower of the Yongbyon reactor on Friday for international cameras, Bush said.