U.S. national intelligence director says North Korea ‘decision time’ near

Federal Bureau of Investigation (FBI) Director Christopher Wray, Central Intelligence Agency (CIA) Director Mike Pompeo, and Director of National Intelligence (DNI) Dan Coats wait to testify before the Senate Intelligence Committee on Capitol Hill in Washington, U.S., February 13, 2018. REUTERS/Aaron P. Bernstein

By Patricia Zengerle and Doina Chiacu

WASHINGTON (Reuters) – The U.S. director of national intelligence, Dan Coats, said on Tuesday time is running out for the United States to act on the threat posed by North Korea’s nuclear programs.

“Decision time is becoming ever closer in terms of how we respond to this,” Coats said during a hearing before the Senate Intelligence Committee. “Our goal is a peaceful settlement. We are using maximum pressure on North Korea in various ways.”

Coats told the Senate panel’s annual hearing on “Worldwide Threats,” with testimony from leaders of major U.S. intelligence agencies, that he expected more missile tests from North Korea this year.

“In the wake of accelerated missile testing since 2016, North Korea is likely to press ahead with more tests in 2018, and its Foreign Minister said that (North Korean leader) Kim (Jong Un) may be considering conducting an atmospheric nuclear test over the Pacific Ocean,” he said.

He said Pyongyang’s repeated statements that nuclear weapons are the basis for its survival suggest government leaders there “do not intend to negotiate them away.”

Democratic Senator Dianne Feinstein asked whether U.S. intelligence has looked into what it might take to bring North Korea to the negotiating table, but Central Intelligence Agency Director Mike Pompeo declined to discuss the subject during a public hearing.

Feinstein said she had participated in a classified briefing recently on North Korea and described it as “difficult and harsh.”

(Reporting by Doina Chiacu and Patricia Zengerle; Editing by Bernadette Baum and Andrea Ricci)

Tougher North Korea sanctions could hit home, analysts say ahead of U.N. vote

People look toward the north through a barbed-wire fence near the militarized zone separating the two Koreas, in Paju, South Korea, December 21, 2017.

By Hyonhee Shin and Heekyong Yang

SEOUL (Reuters) – Newly proposed sanctions on North Korea could have a significant effect on the isolated country’s already struggling economy, analysts said ahead of an expected U.N. Security Council vote on Friday, which will hinge on support from China and Russia.

Tensions have been rising over North Korea’s nuclear and missile programs, which it pursues in defiance of years of different U.N. Security Council resolutions, with bellicose rhetoric from the North and the White House.

But U.S. diplomats have made clear they are seeking a diplomatic solution and have proposed a number of new, tougher sanctions designed to ratchet up pressure on North Korean leader Kim Jong Un.

North Korea regularly threatens to destroy South Korea, the United States and Japan and says its weapons programs are necessary to counter U.S. aggression. The United States stations 28,500 troops in the South, a legacy of the 1950-53 Korean War.

On Friday, a spokesperson for North Korea’s foreign ministry called U.S. President Donald Trump’s recently released national security strategy the latest American policy seeking to “stifle our country and turn the entire Korean peninsula” into an outpost of American hegemony.

He said Trump was seeking “total subordination of the whole world”.

INCREASING PRESSURE

The draft U.N. resolution, seen by Reuters on Thursday, seeks to ban nearly 90 percent of refined petroleum product exports to North Korea by capping them at 500,000 barrels a year and demand the repatriation of North Koreans working abroad within 12 months.

It would also cap crude oil supplies to North Korea at 4 million barrels a year, as well as ban a number of North Korean exports such as machinery, lumber, and other products and resources.

“If they were enforced, the cap on oil would be devastating for North Korea’s haulage industry, for North Koreans who use generators at home or for productive activities, and for (state-owned enterprises) that do the same,” said Peter Ward, a columnist for NK News, a website that tracks North Korea.

The forced repatriation of foreign workers would also cut off vital sources of foreign currency and investment not only for the government but also for North Korea’s emerging market economy, he said.

“If such sanctions were enforced, they would thus impede and endanger North Korea’s economic development.”

Asked about the effects of sanctions before these latest proposals were announced, Michael Kirby, who led a U.N. inquiry into human rights abuses in North Korea, said cutting off fuel imports would be “a very serious step”.

“Cutting off oil, petroleum supplies would obviously have a very big impact on the ordinary population,” he said.

EYES ON CHINA, RUSSIA

China, which supplies most of North Korea’s oil, has backed successive rounds of U.N. sanctions but has resisted past U.S. calls to cut off supplies to its neighbor.

Asked about the proposed new resolution on North Korea, Chinese Foreign Ministry spokeswoman Hua Chunying called on all sides to exercise restraint and to “strictly implement the current relevant U.N. Security Council resolutions”.

While not directly addressing the new proposals, Hua said that China would maintain communications with all sides and supports measures to “quickly create the necessary conditions to peacefully resolve the Korean Peninsula nuclear issue through talks”.

Any move to curb exports of Chinese fuel to North Korea may have limited impact after China National Petroleum Corp suspended diesel and gasoline sales to its northern neighbor in June over concerns the state-owned company would not get paid.

Business has slowed steadily since then, with zero shipments of diesel, gasoline and other fuel from China in October. November data will be released on Monday.

Russia quietly boosted economic support for North Korea earlier this year, and last week Russian Deputy Foreign Minister Igor Morgulov said that Moscow was not ready to sign up to new sanctions that would strangle the country economically.

China and Russia on Thursday asked for more time to consider a U.S. proposal to blacklist 10 ships for transporting banned items from North Korea, diplomats said. It was unclear how much more time would be given.

Even if the proposed sanctions have an economic effect, it’s not clear whether that would push Pyongyang to negotiate or stop its weapons development, said Kim Sung-han, a former South Korean vice foreign minister.

“We have had numerous – sometimes so-called toughest – sanctions against North Korea over the past 25 years,” he said. “Almost none have worked effectively to halt the regime’s military and nuclear ambitions.”

OLYMPIC DREAMS

The additional sanctions would come as South Korean President Moon Jae-in seeks to ease tensions ahead of the 2018 Pyeongchang Winter Olympics in February. He has proposed delaying annual joint military drills with the United States, which North Korea sees as a preparation for invasion, until after the Games.

A foreign ministry spokesperson declined to comment until after the Security Council vote on the resolution on Friday, but an official at South Korea’s Unification Ministry said Seoul supported global efforts to rein in North Korea even as it tries to use the Olympics as a catalyst for peace negotiations.

“The North should have its own thinking about whether or not to participate in the Olympics (regardless of sanctions),” the Unification Ministry official told Reuters. “If it were to come, it would make a decision at the last minute. Until then we will continue to wait and see.”

Seoul has also sought to repair relations with China, which were damaged when Beijing complained over the deployment of an American anti-missile system in South Korea.

Officials at foreign ministries in both Seoul and Beijing have denied reports by travel agents that some Chinese tour groups are still begin blocked from traveling to South Korea.

“As far as I am aware, according to the information I have before me, these reports are not in accord with the facts,” Hua said on Friday.

While Trump and North Korean leader Kim have publicly derided negotiations as useless without major policy shifts by the other side, Seoul has continued a slightly softer approach, while still supporting international pressure.

“If we get to meet the North side, we are willing to have frank, active discussions on various issues that are of North Korea’s interest, without any preconditions,” South Korean Unification Minister Cho Myoung-gyon told reporters in Seoul.

“Next year, we would pursue our policy in a more proactive manner than this year, making use of various opportunities, including the Pyeongchang Olympics.”

(Additional reporting by Christian Shepherd in BEIJING; Writing by Josh Smith; Editing by Nick Macfie)

South Korea fears further missile advances by North this year in threat to U.S.

A flag is pictured outside the Permanent Mission of North Korea in Geneva, Switzerland, November 17, 2017.

By Hyonhee Shin

SEOUL (Reuters) – North Korea may conduct additional missile tests this year to polish up its long-range missile technology and ramp up the threat against the United States, South Korea’s spy agency said on Monday, adding that it was monitoring developments closely.

North Korea is pursuing nuclear weapons and missile programs in defiance of U.N. Security Council sanctions and has made no secret of its plans to develop a missile capable of hitting the U.S. mainland. It has fired two missiles over Japan.

The reclusive state appears to have carried out a recent missile engine test while brisk movements of vehicles were spotted near known missile facilities, Yi Wan-young, a member of South Korea’s parliamentary intelligence committee which was briefed by Seoul’s National Intelligence Service, said.

No sign of an imminent nuclear test had been detected, Yi noted. The third tunnel at the Punggye-ri complex remained ready for another detonation “at any time”, while construction had recently resumed at a fourth tunnel, making it out of use for the time being.

“The agency is closely following the developments because there is a possibility that North Korea could fire an array of ballistic missiles this year under the name of a satellite launch and peaceful development of space, but in fact to ratchet up its threats against the United States,” the lawmakers told reporters after a closed-door briefing by the spy agency.

North Korea defends its weapons programs as a necessary defense against U.S. plans to invade. The United States, which has 28,500 troops in South Korea, a legacy of the 1950-53 Korean war, denies any such intention.

Pyongyang is also carrying out a sweeping ideological scrutiny of the political unit of the military for the first time in 20 years, according to Kim Byung-kee, another lawmaker in the committee.

The probe was led by the ruling Workers’ Party’s Organisation and Guidance Department and orchestrated by Choe Ryong Hae, who once headed the General Political Bureau of the Korean People’s Army himself until he was replaced by Hwang Pyong So in May 2014.

As a result, Hwang and Kim Won Hong, who Seoul’s unification ministry said was removed from office in mid-January as minister of the Stasi-like secret police called “bowibu”, had been punished, the lawmaker said. He did not elaborate.

Choe, who was subjected to political “reeducation” himself in the past, appears to be gaining more influence since he was promoted in October to the party’s powerful Central Military Commission.

The National Intelligence Service indicated that Choe now heads the Organisation and Guidance Department, a secretive body that oversees appointments within North Korea’s leadership.

“Under Choe’s command, the Organisation and Guidance Department is undertaking an inspection of the military politburo for the first time in 20 years, taking issue with their impure attitude toward the party leadership,” the lawmaker, Kim, said.

Separately on Monday, South Korea approved a request by a South Korean to attend an event in the North marking the anniversary of the death of his mother who formerly led the Chondoist Chongu Party, a minor North Korean political party.

The son, identified only by his surname Choi, will be the first South Korean to visit the North since liberal President Moon Jae-in took office in May.

He is scheduled to arrive in Pyongyang via China on Wednesday and return on Saturday, according to Seoul’s unification ministry.

A senior Chinese official wrapped up a four-day visit to North Korea on Monday, apparently without meeting the country’s leader, Kim Jong Un.

Song Tao, head of the international department of the Chinese Communist Party, met senior officials from the Workers Party of Korea and “exchanged views on the Korean peninsula issue”, China’s official Xinhua news agency said.

“The ruling parties of China and the Democratic People’s Republic of Korea on Monday pledged to strengthen inter-party exchanges and coordination, and push forward relations,” it added, using North Korea’s official name.

Song had been in Pyongyang to discuss the outcome of the recently concluded Chinese Communist Party Congress in Beijing.

 

(Additional reporting by Christine Kim, and Ben Blanchard in BEIJING; Editing by Nick Macfie and Clarence Fernandez)

 

South Korea spy agency sees signs of planned new missile test by North

North Korean leader Kim Jong Un visits a cosmetics factory in this undated photo released by North Korea's Korean Central News Agency (KCNA) in Pyongyang on October 28, 2017.

By Hyonhee Shin

SEOUL (Reuters) – North Korea may be planning a new missile test, South Korea’s spy agency told lawmakers on Thursday, after brisk activity was spotted at its research facilities, just days before U.S. President Donald Trump visits Seoul.

Reclusive North Korea has carried out a series of nuclear and missile tests in defiance of U.N. Security Council resolutions, but has not launched any missiles since firing one over Japan on Sept. 15, the longest such lull this year.

However a flurry of activity including the movement of vehicles has been detected at the North’s missile research facilities in Pyongyang, where the most recent missile test was conducted, pointing to another possible launch, South Korea’s Intelligence Service said in a briefing to lawmakers.

It did not say how the activity was detected.

North Korea has made no secret of its plans to perfect a nuclear-tipped missile capable of reaching the U.S. mainland. It regularly threatens to destroy the United States and its “puppet”, South Korea.

“There is a possibility of a new missile launch given the active movement of vehicles around the missile research institute in Pyongyang. The North will constantly push for further nuclear tests going forward, and the miniaturization and diversification of warheads,” the intelligence agency said at the briefing.

The North’s nuclear testing site in the northwestern town of Punggye-ri could have been damaged by its sixth and largest nuclear test on Sept. 3, according to Kim Byung-kee, Yi Wan-young and Lee Tae-gyu, members of South Korea’s parliamentary intelligence committee.

The explosion triggered an aftershock within eight minutes and three additional shocks.

Japanese broadcaster TV Asahi, citing unnamed sources, said on Tuesday a tunnel at the test site collapsed after that explosion, possibly killing more than 200 people. Reuters has not been able to verify the report which North Korea on Thursday denounced as false and defamatory.

Pyongyang will likely detonate more devices as it tries to master the miniaturization of nuclear warheads to put atop missiles, the lawmakers said.

The third tunnel at the Punggye-ri complex remained ready for another test “at any time”, while construction had resumed at a fourth tunnel, making it unable to be used “for a considerable amount of time”, they added.

Trump is to visit five Asian nations in coming days for talks in which North Korea will be a major focus. The visit includes the North’s lone major ally, China, and U.S. allies Japan and South Korea, which have watched with increasing worry as Trump and North Korea have exchanged bellicose rhetoric.

 

(Reporting by Hyonhee Shin in Seoul; Editing by Nick Macfie)

 

North Korea threat is ‘critical, imminent,’ Japan tells U.S., South Korea

People watch a television broadcasting a news report on North Korea firing a missile that flew over Japan's northern Hokkaido far out into the Pacific Ocean, in Seoul, South Korea, September 15, 2017. REUTERS/Kim Hong-Ji

By Phil Stewart

CLARK FREEPORT ZONE, Philippines (Reuters) – The threat from North Korea has grown to a “critical and imminent level” and the United States, Japan and South Korea must address the matter, Japanese Defense Minister Itsunori Onodera told his U.S. and South Korean counterparts in talks on Monday.

Onodera’s remarks underscored the deep concern in Tokyo after North Korean weapons tests, including test firing missiles over Japan, as Pyongyang seeks to develop a nuclear-tipped missile capable of reaching the United States.

His comments broke from more measured language on Monday by U.S. Defense Secretary Jim Mattis and South Korean Defense Minister Song Young-Moo, as the three men met on the sidelines of a gathering of Asian defense chiefs in the Philippines.

“(The) threat posed by North Korea has grown to the unprecedented, critical and imminent level. Therefore, we have to take calibrated and different responses to meet with that level of threat,” he said, speaking through a translator, at the start of talks in the Philippines.

South Korea’s Song also acknowledged that “North Korea’s provocative behavior is becoming worse and worse,” in public remarks before reporters were escorted out of the meeting room.

Mattis renewed sharp criticism of North Korea’s tests, saying they “threaten regional and global security.”

Mattis, who kicked off a week-long trip to the region on Monday, has been eager to emphasize diplomatic efforts to resolve the crisis peacefully as escalating tension between Washington and Pyongyang stoked fears of ‘armed confrontation.’

Asked about his conversation with Onodera after the two met earlier in the day, before joining South Korea’s Song, Mattis said they discussed “maintaining stability and peace in support of the diplomats.”

Meanwhile, former U.S. President Jimmy Carter said he is willing to travel to North Korea on behalf of the Trump administration to help diffuse the situation, the New York Times reported.

Mattis has been more cautious in his public remarks than U.S. President Donald Trump, who has been locked in a war of words with North Korean leader Kim Jong Un, threatening to destroy North Korea if necessary to defend the United States and its allies.

Kim has blasted Trump as “mentally deranged.”

 

‘GRAVE CONCERN’

Mattis is at the start of a week-long trip to Asia and will attend meetings hosted by defense ministers from the Association of Southeast Asian Nations (ASEAN) in the Philippines.

ASEAN defense ministers, in a joint statement, expressed “grave concern” over North Korea’s nuclear and missile programs and urged the reclusive country to meet its international obligations and resume communications.

They underscored the “need to maintain peace and stability in the region” and called “for the exercise of self-restraint and the resumption of dialogue to de-escalate tensions in the Korean peninsula.”

Mattis’ trip, which will include a stop in Thailand, comes before Trump’s first visit to Asia next month, including a stop in China.

Trump has been pressuring China to do more to rein in North Korea’s missile and nuclear program. China is North Korea’s neighbor and biggest trading partner.

Mattis, while in the Philippines, said he will commend the military for defeating insurgents in Marawi City on the islandof Mindanao.

The Philippines said on Monday it has ended five months of military operations in Marawi after a fierce and unfamiliar urban war that marked the country’s biggest security crisis in years.

Some experts see the Marawi insurgency as a prelude to a more ambitious bid by Islamic State loyalists to exploit Mindanao’s poverty and use its jungles and mountains as a base to train, recruit and launch attacks in the region.

“It was a tough fight,” Mattis told reporters on his flight to the Philippines, adding he thought the Philippines’ military had sent “a very necessary message to the terrorists.”

On Thursday, Mattis will lead the U.S. delegation inThailand for the cremation rites for the late King Bhumibol Adulyadej.

 

(Reporting by Phil Stewart; Additional reporting by Manuel Mogato in Manila; Editing by Peter Cooney and Jeffrey Benkoe)

 

U.S. carrier patrols off Korean peninsula in warning to Pyongyang

The aircraft carrier USS Ronald Reagan conducts joint drills with the South Korean navy at sea October 19, 2017. REUTERS/Tim Kelly

By Tim Kelly

ABOARD USS RONALD REAGAN, Sea of Japan (Reuters) – The USS Ronald Reagan, a 100,000-ton nuclear powered aircraft carrier, patrolled in waters east of the Korean peninsula on Thursday, in a show of sea and air power designed to warn off North Korea from any military action.

The U.S. Navy’s biggest warship in Asia, with a crew of 5,000 sailors, sailed around 100 miles (160.93 km), launching almost 90 F-18 Super Hornet sorties from its deck, in sight of South Korean islands.

It is conducting drills with the South Korean navy involving 40 warships deployed in a line stretching from the Yellow Sea west of the peninsula into the Sea of Japan.

“The dangerous and aggressive behavior by North Korea concerns everybody in the world,” Rear Admiral Marc Dalton, commander of the Reagan’s strike group, said in the carrier’s hangar as war planes taxied on the flight deck above.

“We have made it clear with this exercise, and many others, that we are ready to defend the Republic of Korea.”

The Navy's forward-deployed aircraft carrier USS Ronald Reagan and the forward-deployed Arleigh Burke-class destroyer USS Stethem steam alongside ships from the Republic of Korea Navy in the waters east of the Korean Peninsula on October 18, 2017.

The Navy’s forward-deployed aircraft carrier USS Ronald Reagan and the forward-deployed Arleigh Burke-class destroyer USS Stethem steam alongside ships from the Republic of Korea Navy in the waters east of the Korean Peninsula on October 18, 2017. Picture taken on October 18, 2017. Courtesy Kenneth Abbate/U.S. Navy/Handout via REUTERS

The Reagan’s presence in the region, coupled with recent military pressure by Washington on Pyongyang, including B1-B strategic bomber flights over the Korean peninsula, comes ahead of President Donald Trump’s first official visit to Asia, set to start in Japan on Nov. 5, with South Korea to follow.

North Korea has slammed the warship gathering as a “rehearsal for war”. It comes as senior Japanese, South Korean and U.S. diplomats meet in Seoul to discuss a diplomatic way forward backed up by U.N. sanctions.

The U.N. Security Council has unanimously ratcheted up sanctions on North Korea over its nuclear and ballistic missile programmes since 2006. The most stringent include a ban on coal, iron ore and seafood exports that aim at halting a third of North Korea’s $3 billion of annual exports.

On Monday, Kim In Ryong, North Korea’s deputy U.N. envoy, told a U.N. General Assembly committee the Korean peninsula situation had reached a touch-and-go point and a nuclear war could break out at any moment.

A series of weapons tests by Pyongyang, including its sixth and most powerful nuclear test on Sept. 3 and two missile launches over Japan, has stoked tension in East Asia.

A Russian who returned from a visit to Pyongyang has said the regime is preparing to test a missile it believes can reach the U.S. west coast.

On Sunday, Secretary of State Rex Tillerson said President Donald Trump had instructed him to continue diplomatic efforts to defuse tension with North Korea.

Washington has not ruled out the eventual possibility of direct talks with the North to resolve the stand-off, U.S. Deputy Secretary of State John J. Sullivan said on Tuesday.

 

 

(Reporting by Tim Kelly; Editing by Clarence Fernandez)

 

Southeast Asian ministers urge North Korea to rein in weapons programs

North Korean leader Kim Jong-Un looks on during a visit to the Chemical Material Institute of the Academy of Defense Science in this undated photo released by North Korea's Korean Central News Agency (KCNA) in Pyongyang on August 23, 2017. KCNA/via REUTERS

By Manuel Mogato

CLARK FREEPORT ZONE, Philippines (Reuters) – Southeast Asian defense ministers on Monday expressed “grave concern” over North Korea’s nuclear and missile programs and urged the reclusive country to meet its international obligations and resume communications.

North Korea is working to develop a nuclear-tipped missile capable of striking the U.S. mainland and has ignored all calls, even from its lone major ally, China, to rein in its weapons programs which it conducts in defiance of U.N. Security Council resolutions.

Defense ministers from the Association of Southeast Asian Nations (ASEAN), in a joint statement, underscored the “need to maintain peace and stability in the region” and called “for the exercise of self-restraint and the resumption of dialogue to de-escalate tensions in the Korean peninsula”.

They are due to meet with their counterparts from the United States, China, Japan, South Korea, India, Australia, Russia and New Zealand on Tuesday when North Korea, the disputed South China Sea and terrorism are expected to top the agenda.

U.S. Defense Secretary Jim Mattis has said he will talk with Asian allies about North Korea and the crisis caused by its “reckless” provocations.

Mattis’s trip to Asia, which will also include stops in Thailand and South Korea, comes just weeks before Donald Trump’s first visit to Asia as U.S. president.

In the same statement, the ministers reiterated the importance of “safety and freedom of navigation in and over-flight above the South China Sea” and called for “self restraint in the conduct of activities”.

They also vowed to work together to combat terrorism as they condemned the attack by the Maute militant group in the southern Philippine city of Marawi.

The Philippines on Monday announced the end of five months of military operations in Marawi after a fierce and unfamiliar urban war that marked the country’s biggest security crisis in years.

 

 

 

(Writing by Karen Lema; Editing by Nick Macfie)

 

South Korea warns that North may launch ICBM after nuclear test

South Korean troops fire Hyunmoo Missile into the waters of the East Sea at a military exercise in South Korea September 4, 2017.

By Christine Kim and David Brunnstrom

SEOUL/WASHINGTON (Reuters) – South Korea said on Monday it was talking to the United States about deploying aircraft carriers and strategic bombers to the Korean peninsula after signs North Korea might launch more missiles in the wake of its sixth and largest nuclear test.

The U.N. Security Council was set to meet later on Monday to discuss new sanctions against the isolated regime. U.S. President Donald Trump had also asked to be briefed on all available military options, according to his defense chief.

Officials said activity around missile launch sites suggested North Korea planned more missile tests.

“We have continued to see signs of possibly more ballistic missile launches. We also forecast North Korea could fire an intercontinental ballistic missile,” Jang Kyoung-soo, acting deputy minister of national defense policy, told a parliament hearing on Monday.

North Korea tested two ICBMs in July that could fly about 10,000 km (6,200 miles), putting many parts of the U.S. mainland within range and prompting a new round of tough international sanctions.

South Korea’s air force and army conducted exercises involving long-range air-to-surface and ballistic missiles on Monday following the North’s nuclear test on Sunday, its joint chiefs of staff said in a statement.

In addition to the drill, South Korea will cooperate with the United States and seek to deploy “strategic assets like aircraft carriers and strategic bombers”, Jang said.

South Korea’s defense ministry also said it would deploy the four remaining launchers of a new U.S. missile defense system after the completion of an environmental assessment by the government.

The rollout of the controversial Terminal High Altitude Area Defense (THAAD) system at a site south of the South Korean capital, Seoul, is vehemently opposed by neighboring China and Russia, had been delayed since June.

 

TOUGH TALK

North Korea said it tested an advanced hydrogen bomb for a long-range missile on Sunday, prompting a warning of a “massive” military response from the United States if it or its allies were threatened.

“We are not looking to the total annihilation of a country, namely North Korea,” U.S. Defense Secretary Jim Mattis said after meeting Trump and his national security team.

“But as I said, we have many options to do so.”

Trump has previously vowed to stop North Korea developing nuclear weapons and said he would unleash “fire and fury” if it threatened U.S. territory

Despite the tough talk, the immediate focus of the international response was expected to be on tougher economic sanctions.

Diplomats have said the U.N. Security Council could now consider banning North Korean textile exports and its national airline, stop supplies of oil to the government and military, prevent North Koreans from working abroad and add top officials to a blacklist to subject them to an asset freeze and travel ban.

Asked about Trump’s threat to punish countries that trade with North Korea, Chinese Foreign Ministry spokesman Geng Shuang said China has dedicated itself to resolving the North Korean issue via talks, and China’s efforts had been recognized.

“What we absolutely cannot accept is that on the one hand (we are) making arduous efforts to peacefully resolve the North Korean nuclear issue, and on the other hand (our) interests are being sanctioned or harmed. This is both not objective and not fair,” he told a regular briefing.

On possible new U.N. sanctions, and whether China would support cutting off oil, Geng said it would depend on the outcome of Security Council discussions.

Chinese state-run Xinhua news agency said in an editorial North Korea was “playing a dangerous game of brinkmanship” and it should wake up to the fact that such a tactic “can never bring security it pursues”.

While South Korean President Moon Jae-in and Japanese Prime Minister Shinzo Abe agreed on Monday to work with the United States to pursue stronger sanctions, Russia voiced scepticism.

Russian Deputy Foreign Minister Sergei Ryabkov said sanctions on North Korea had reached the limit of their impact. Any more would be aimed at breaking its economy, so a decision to impose further constraints would become dramatically harder, he told a BRICS summit in China.

South Korea says the aim of stronger sanctions is to draw North Korea into dialogue. But, in a series of tweets on Sunday, Trump also appeared to rebuke South Korea for that approach.

“South Korea is finding, as I have told them, that their talk of appeasement with North Korea will not work, they only understand one thing!” Trump said on Twitter.

Still, Trump’s response was more orderly and less haphazard than he had offered to other hostile actions by North Korea.

His handling of its latest nuclear test reflected a more traditional approach to crisis management, which U.S. officials said illustrated the influence of Mattis and new White House chief of staff, retired Marine Corps General John Kelly.

 

MARKETS CAUTIOUS

Japanese and South Korean stock markets both closed down about 1 percent on Monday, while safe haven assets including gold and sovereign bonds ticked higher, but trade was cautious. [MKTS/GLOB]

“Assuming the worst on the Korean peninsula has not proven to be a winning trading strategy this year,” said Sean Callow, a senior foreign exchange strategist at Westpac Bank.

“Investors seem reluctant to price in anything more severe than trade sanctions, and the absence of another ‘fire and fury’ Trump tweet has helped encourage markets to respond warily.”

South Korea’s finance minister vowed to support financial markets if instability showed signs of spreading to the real economy.

Sunday’s test had registered with international seismic agencies as a man-made earthquake near a test site. Japanese and South Korean officials said the tremor was about 10 times more powerful than the one picked up after North Korea’s previous nuclear test a year ago.

China’s National Nuclear Safety Administration said data from radiation monitoring stations near the North Korean border showed no impact on “China’s environment or populace”.

Australian Prime Minister Malcolm Turnbull said that, while North Korea was not a puppet state of China, Beijing needed to do more to pressure its neighbor.

“The Chinese are frustrated and dismayed by North Korea’s conduct, but China has the greatest leverage, and with the greatest leverage comes the greatest responsibility,” he told the Australian Broadcasting Corp on Monday.

 

For a graphic on nuclear North Korea, click: http://fingfx.thomsonreuters.com/gfx/rngs/NORTHKOREA-MISSILES/010031V7472/index.html

 

 

(Additional reporting by Shin-hyung Lee, Hyunjoo Jin, Cynthia Kim in SEOUL, Steve Holland and John Walcott in WASHINGTON, John Ruwitch in SHANGHAI, Wayne Cole and Swati Pandey in SYDNEY; Writing by Lincoln Feast; Editing by Paul Tait, Robert Birsel)

 

Russian-North Korea projects foundering because of missile tests

A guard walks along a platform past signs, which read "Russia" (L) and "DPRK"(Democratic People's Republic of Korea), at the border crossing between Russia and North Korea in the settlement of Tumangan, North Korea July 18, 2014.

By Polina Nikolskaya and Katya Golubkova

MOSCOW (Reuters) – Commercial ventures planned between Russia and North Korea three years ago are not being implemented because of Pyongyang’s missile testing program, the Minister for the Development of the Russian Far East, Alexander Galushka, said.

Russia has been under international scrutiny over North Korea because it has taken a more doveish approach to Pyongyang than Washington, and Russian trade with North Korea increased sharply at the start of this year.

The United States government earlier this month imposed new North Korea-related sanctions that targeted Russian firms and individuals for, it alleged, supporting Pyongyang’s weapons programs and providing oil.

However Galushka, in an interview with Reuters, said Moscow was faithfully implementing the international sanctions regime on North Korea, and held up the stalled bilateral projects as an indication that Pyongyang was paying an economic price for its weapons program.

“Russia has not violated, does not violate and will not work outside the framework (of the resolution) that was accepted by the U.N. Security Council,” said Galushka, who also heads a Russia-North Korean Intergovernmental Commission.

Russian businesses discussed a number of projects with North Korea in 2014. But then North Korea conducted military tests, including some involving nuclear weapons, and the projects became difficult to implement, Galushka said.

One such project, called “Pobeda”, or “Victory,” would have involved Russian investments and supplies that could be exchanged for access to Korean natural resources.

“We told our North Korean partners more than once … that it hampers a lot, makes it impossible, it restricts things, it causes fear,” Galushka said, referring to the weapons testing.

Another joint project between the two countries is a railway link with North Korea, from the Russian eastern border town of Khasan to Korea’s Rajin.

It is operating but below its potential. The link could work at a capacity of 4 million tonnes a year, officials have said previously, but now it only carries around 1.5 million tonnes of coal per year, according to Galushka.

UN sanctions also prohibit countries from increasing the current numbers of North Korean laborers working in their territories.

According to Galushka, around 40,000 employees from North Korea worked in Russia. Mainly they are engaged in timber processing and construction.

Russian business is interested in access to the North Korea workforce, Galushka said, but the numbers will stay in line with what the sanctions permit.

He said 40,000 workers from North Korea “is a balance formed in the economy, neither more nor less.”

Bilateral trade between the two countries has been decreasing for the last four years, from $112.7 million in 2013 to $76.9 million in 2016, according to Russian Federal Customs Service statistics.

But it more than doubled to $31.4 million in the first quarter of 2017 in year-on-year terms. Most of Russia’s exports to North Korea are oil, coal and refined products.

Asked to explain why trade was rising if political issues were hurting commercial projects, a spokeswoman for Galushka’s ministry said in an email: “According to the latest data, there was an objective increase due to exports to North Korea, primarily oil products. But the export of oil does not violate the agreements of the UN countries in any way.”

The interview with Galushka took place before the U.S. imposed the sanctions targeting Russian entities and individuals for trading with North Korea.

Galushka’s ministry referred questions about the new sanctions to the Russian foreign ministry.

Maria Zakharova, a foreign ministry spokeswoman, told reporters Washington’s unilateral sanctions worsened tensions on the Korean peninsula, and that Russia is fulfilling its international obligations in full.

 

(Editing by Andrew Heavens)

 

U.S., South Korea begin computer-simulated drills which North says are aimed at nuclear war

A U.S. Air Force U-2 Dragon Lady takes part in a drill at Osan Air Base in Pyeongtaek, South Korea, August 21, 2017.

By Christine Kim

SEOUL (Reuters) – South Korean and U.S. forces began computer-simulated military exercises on Monday amid tension over North Korea’s weapons programs, while a report it has earned millions of dollars in exports is likely to raise doubt about the impact of sanctions.

South Korean President Moon Jae-in said the joint drills, called Ulchi Freedom Guardian, were purely defensive and did not aim to increase tension on the peninsula, but North Korea denounced the exercises as preparation for war.

“There is no intent at all to heighten military tension on the Korean peninsula as these drills are held annually and are of a defensive nature,” Moon told cabinet ministers.

“North Korea should not exaggerate our efforts to keep peace nor should they engage in provocations that would worsen the situation, using (the exercise) as an excuse,” he said.

The joint U.S.-South Korean drills last until Aug. 31 and involve computer simulations designed to prepare for war with a nuclear-capable North Korea.

The United States also describes them as “defensive in nature”, a term North Korean state media has dismissed as a “deceptive mask”.

“It’s to prepare if something big were to occur and we needed to protect ROK,” said Michelle Thomas, a U.S. military spokeswoman, referring to South Korea by its official name, the Republic of Korea.

North Korea views such exercises as preparations for invasion and has fired missiles and taken other actions to show its anger over military drills in the past.

“This is aimed to ignite a nuclear war on the Korean peninsula at any cost,” the North’s KCNA news agency said.

“The situation on the Korean peninsula has plunged into a critical phase due to the reckless north-targeted war racket of the war maniacs.”

North and South Korea are technically still at war after the 1950-53 Korean War ended with a truce, not a peace treaty.

North Korea’s rapid progress in developing nuclear weapons and missiles capable of reaching the U.S. mainland has fueled a surge in regional tension and U.N.-led sanctions appear to have failed to bite deeply enough to change its behavior.

China, North Korea’s main ally and trading partner, has urged the United States and South Korea to scrap the exercises. Russia has also asked for the drills to stop but the United States has not backed down.

Speaking in Beijing, Chinese Foreign Ministry spokeswoman Hua Chunying said North and South Korea and the United States all needed to make more effort to ease tension.

“We think that South Korea and the United States holding joint drills is not beneficial to easing current tensions or efforts by all sides to promote talks,” she told a daily news briefing.

 

SANCTIONS UNDERMINED

Japan’s Kyodo news agency reported that a confidential U.N. report found North Korea evaded U.N. sanctions by “deliberately using indirect channels” and had generated $270 million in banned exports since February.

The “lax enforcement” of existing sanctions and Pyongyang’s “evolving evasion techniques” were undermining the U.N. goal of getting North Korea to abandon its nuclear and ballistic missile programs, Kyodo quoted the report as saying.

The U.N. Security Council unanimously imposed new sanctions on North Korea on Aug. 5 that could slash its $3 billion annual export revenue by a third. The latest sanctions were imposed after North Korea tested two intercontinental ballistic missiles in July.

U.S. President Donald Trump warned North Korea this month it would face “fire and fury” if it threatens the United States.

The North responded by threatening to fire missiles towards the U.S. Pacific island territory of Guam, but later said it was holding off while it waited to see what the United States would do next.

There will be no field training during the current exercise, according to U.S. Forces Korea.

The United States has about 28,000 troops in South Korea. About 17,500 U.S. service members are participating in the exercise this month, down from 25,000 last year, according to the Pentagon.

U.S. Defense Secretary Jim Mattis said on Sunday the reduction in the number of U.S. troops taking part reflected a need for fewer personnel and was not because of tension with North Korea.

Other South Korean allies are also joining this year, with troops from Australia, Britain, Canada, Colombia, Denmark, the Netherlands, and New Zealand taking part.

 

(Writing by Linda Sieg; Additional reporting by Ben Blanchard in BEIJING; Editing by Paul Tait, Robert Birsel)