Tag Archives: Tensions

Cruise control: China squeezes South Korea as boats and planes stay away

A Royal Caribbean cruise is seen at a port in Dalian, Liaoning province, China, July 20, 2017. Picture taken July 20, 2017. REUTERS/Stringer

By Adam Jourdan and Cynthia Kim

SHANGHAI/SEOUL (Reuters) – Pressure in China on travel firms forced airlines and cruise operators to cut routes to South Korea, as the fallout spread on Friday from a diplomatic row over Seoul’s plans to deploy a U.S. missile defense system against Beijing’s objections.

China Eastern Airlines Corp Ltd <600115.SS> and Spring Airlines Co Ltd <601021.SS> stopped offering flights on their websites between the eastern Chinese city of Ningbo and popular South Korean tourist island Jeju from next week.

Korea’s Eastar Jet said it was halting flights between the South Korean cities of Cheongju and tourist hotspot Jeju with various Chinese cities including Ningbo, Jinjiang and Harbin.

This followed Carnival Corp’s <CCL.N> Costa Cruises and Royal Caribbean Cruises <RCL.N> cutting South Korean visits by their China ships. Royal Caribbean cited “recent developments regarding the situation in South Korea”.

The moves reflect a more aggressive and blatant stance against South Korean business in China, although Beijing has not directly said it is targeting South Korean firms.

An internal South Korean government document seen by Reuters said Chinese authorities gave a “7-point” verbal instruction to travel firms to curtail or ban trips to South Korea.

These included a ban on tour groups visiting South Korea from March 15, cruise ships not being allowed to dock in South Korea ports and a warning that those who violated the guidance would face “severe punishment”.

Reuters could not immediately reach China’s tourism administration for comment. China Eastern and Spring Airlines did not respond to requests for comment.

The crackdown has sent a chill across South Korea’s retail and tourism sectors, which rely heavily on China trade, and prompted South Korea to say it will consider filing a complaint against China to the World Trade Organization.

South Korea sold $124 billion worth of goods and services to China last year, about five times the amount it exported to nearby Japan and double the amount it shipped to its second-biggest overseas market, the United States.

Tourism is a particularly sensitive sector, with official South Korean data showing almost half of the visitors to the country come from China.

Asked about cruise operators cancelling South Korean port visits, an official from South Korea’s Ministry of Trade, Industry and Energy told Reuters the ministry was checking if any WTO rules have been violated.

“If we are to launch a dispute, we still need to make sure if anything has been ordered by Beijing,” the official said.

“RELEVANT DEPARTMENTS”

Political risk analysts said the widespread actions against South Korean firms pointed to centralized coordination.

Princess Cruises, also owned by Carnival, said in a statement on Friday it would remove visits to South Korea from routes after talks with “relevant departments”.

“Due to the current situation, Princess Cruises’ China team has been in close dialogue and prudent discussions with relevant departments,” the firm said. “All routes which involve South Korea have been altered.”

The diplomatic problems with its biggest trade partner have come at a difficult time for South Korea.

On Friday, South Korea’s Constitutional Court removed President Park Geun-hye from office on Friday over a graft scandal involving the country’s conglomerates.

Analysts said the upheaval had given China the opportunity to put pressure on Park’s possible successors to ditch or delay the installation of the U.S. Terminal High Altitude Area Defence (THAAD) missile system.

“I think they’ll keep up this pressure well into the period where we get a new government in South Korea,” said Andrew Gilholm, director of analysis for China and North Asia at risk consultancy Control Risks.

“Possibly the reason they’re pushing so hard is that they are trying to influence whatever policy the next government in Seoul takes.”

Meantime, South Koreans living in China have been advised by business groups to adopt a low profile, while residents and shopkeepers in a Shanghai neighborhood where many South Koreans live told Reuters of a growing sense of anxiety.

“I feel wherever I am people are watching me. On the street, in the car and at restaurants, I don’t feel I can freely speak Korean,” said Seo Lan Kyung, 48, a housewife who said she has been living in China for 18 years.

“I want to keep living here but increasingly there’s a feeling of impending crisis.”

(Additional reporting by Christian Shepherd and Muyu Xu in BEIJING, Alexandra Harney in SHANGHAI, Heekyong Yang and Hyunjoo Jun in SEOUL; Editing by Simon Cameron-Moore)

Turkish tensions with Europe risk spilling into Switzerland

European Union (L) and Turkish flags fly outside a hotel in Istanbul, Turkey May 4, 2016. REUTERS/Murad Sezer/File Photo

By Michael Shields

ZURICH (Reuters) – Neutral Switzerland risks getting swept up in Turkey’s political row with European countries as Swiss authorities weigh how to handle Turks’ requests for asylum and a call to ban a rally on Sunday by Turkey’s foreign minister.

The government was keeping a low profile on Thursday, saying only that it was reviewing a request by financial capital Zurich to block a planned weekend appearance by Foreign Minister Mevlut Cavusoglu for security reasons.

The Hilton hotel booked for the rally canceled the event, saying organizers could not ensure the safety of guests and visitors.

It comes amid a series of speaking engagements to galvanize support among the Turkish community for President Tayyip Erdogan’s bid to increase his powers in a referendum on April 16.

The foreign ministry declined to comment on media reports that several Turks with diplomatic passports, including the second-ranking envoy in Bern, had sought asylum after President Tayyip Erdogan’s crackdown in the wake of a failed coup last year.

The State Secretariat for Migration, which handles asylum requests, said it does not comment on individual requests for refugee status. It referred instead to a government response this week to a parliamentary query on the matter.

That note said 408 Turkish citizens had sought asylum since the July coup attempt, including some holders of diplomatic passports. It said it could not comment further on the “very few individual cases” among diplomats for fear it could give away their identities.

Turkish embassy officials in Bern were not immediately available by phone and did not respond to an email seeking comment.

During a visit to neighboring Germany on Wednesday, Cavusoglu accused Berlin of hostility towards his country and Islam as acrimony between the NATO allies showed no sign of abating.

On Thursday, Chancellor Angela Merkel told Turkey to stop comparing the German government to the Nazis over the cancellation of Turkish ministers’ rallies in Germany, only for Cavusoglu to repeat the comparison.

Ankara is furious over the cancellations. Germany has said the rallies can go ahead if the organizers respect local laws, but has canceled several rallies, citing security concerns.

In Austria, the interior minister said this week he wanted to change legislation to permit a ban on foreign officials making speeches in Austria if human rights or public order were threatened, a move aimed at Turkish politicians.

Swiss government statistics show around 68,000 Turkish citizens live in Switzerland, a nation of 8.3 million whose population is a quarter foreign. The Turkish embassy’s website refers to around 130,000 Turkish citizens.

(Additional reporting by Brenna Hughes Neghaiwi; Editing by Hugh Lawson)

U.S. ship changed course toward Iranians on Saturday: Iran commander

File photo: U.S. sailors in a rigid-hull inflatable boat approach the Military Sealift Command missile range instrumentation ship USNS Invincible (L) to conduct a personnel transfer in Arabian Sea on November 21, 2012. Courtesy Deven B. King/U.S. Navy/Handout via REUTERS

BEIRUT (Reuters) – A U.S. Navy ship changed course toward Iranian Revolutionary Guard vessels in the Strait of Hormuz on Saturday, a guard commander was quoted as saying on Wednesday while issuing a warning.

A U.S. official told Reuters on Monday that multiple fast-attack vessels from the Revolutionary Guard had come within 600 yards (550 meters) of the USNS Invincible, a tracking ship, forcing it to change direction.

But guard commander Mehdi Hashemi said the incident, the first of note between the countries’ navies in those waters since January, was the fault of the U.S. ship, telling the Fars news agency: “The unprofessional actions of the Americans can have irreversible consequences,”

Years of mutual animosity eased when Washington lifted sanctions on Tehran last year after a deal to curb Iran’s nuclear ambitions. But major differences remain over Iran’s ballistic missile program and conflicts in Syria and Iraq.

Iranian president Hassan Rouhani, without referring to the Hormuz incident, also gave a warning on Wednesday.

“If Iran’s ignorant enemies think about invading Iran they should know that our armed forces are much stronger than 1980 when Iraq attacked,” he said in a speech broadcast live on state TV.

While still a U.S. presidential candidate in September, Donald Trump vowed that any Iranian vessels that harassed the U.S. Navy in the Gulf would be “shot out of the water.”

Trump’s administration said on Tuesday it would show “great strictness” over restrictions on Iran’s activities under the nuclear deal with major powers, but gave little indication of what that might mean.

The last serious naval incident was in January when a U.S. destroyer fired three warning shots at four Iranian fast-attack vessels near the Strait after they closed in at high speed and disregarded repeated requests to slow down.

Pentagon spokesman Captain Jeff Davis said in Washington on Monday that dangerous interactions were of concern because they could lead to a “miscalculation or an accidental provocation.”

“We actually had seen quite an improvement in Iran’s behavior until recently,” he said.

(Reporting By Babak Dehghanpisheh; additional reporting by Bozorgmehr Sharafedin in Dubai; editing by John Stonestreet)

Turkey accuses Germany of aiding its enemies, as row escalates

FILE PHOTO: Turkish President Tayyip Erdogan (R) is pictured wit Justice Minister Bekir Bozdag during the International Istanbul Law Congress in Istanbul, October 17, 2016. REUTERS/Murad Sezer/File

By Tulay Karadeniz

ANKARA (Reuters) – Turkish leaders condemned Germany on Friday for cancelling rallies of Turkish residents due to be addressed by Ankara’s ministers and accused Berlin of giving “shelter” to Turkey’s enemies.

As the diplomatic spat between the two countries became increasingly angry, Turkish President Tayyip Erdogan said a German journalist being held in Turkey was a “German agent” and a member of an armed Kurdish militant group.

A source in Germany’s foreign ministry on Friday night told Reuters those accusations were “absurd”.

Earlier, comments in Berlin by Turkey’s Justice Minister Bekir Bozdag, who had been scheduled to address a meeting in the southwestern town of Gaggenau until it was canceled on Thursday, reflected a broader souring of relations between the two NATO allies.

“Let them look back at their history,” Bozdag said in a speech. “We see the old illnesses flaring up.”

The city of Cologne also blocked an event where Turkey’s Economy Minister Nihat Zeybecki was to speak on Sunday. Police said shortly after that a second gathering he had been due to attend in the western town of Frechen was also canceled.

Zeybecki said he still planned to go to Germany.

“We say the victory is God’s…I will go from cafe to cafe, house to house,” he said. “Nobody should worry, we will still meet with our citizens in Germany.”

Chancellor Angela Merkel, speaking in Tunis, said her government had played no part in steps taken by city councils who, according to one mayor, acted purely on security grounds.

She renewed her criticism of Turkey’s arrest of Deniz Yucel, a correspondent for German newspaper Die Welt.

“We support freedom of expression and we can criticize Turkey,” she told reporters.

The German foreign ministry urged Ankara to refrain from “pouring oil on the fire”.

GERMANY “ABETTING TERRORISM”

Erdogan said in Ankara the cause of the tensions between the two countries was Germany’s support for Turkey’s enemies.

“It isn’t because a correspondent of Die Welt was arrested,” Erdogan told an awards ceremony in Istanbul.

“It is because this person hid in the German embassy as a member of the PKK and a German agent for one month. When we told them to hand him over to be tried, they refused.”

“So, they won’t let our justice minister and economy minister speak,” Erdogan added.

“They need to be tried for helping and abetting terrorism.”

Gaggenau would have been part of efforts to garner support among 1.5 million Turkish citizens for an April referendum expanding Erdogan’s powers – something he has sought with increased urgency since an army bid to topple him.

Erdogan has accused West European countries of failing to condemn the July putsch quickly or strongly enough. West European countries have expressed concern about his subsequent crackdown on journalists, judiciary, academics and others.

On Friday evening the Dutch government said plans by Turkish authorities to hold a referendum campaign rally in Rotterdam were “undesirable”.

The leader of an association of Dutch Turks said Turkish Foreign Minister Mevlut Cavusoglu was planning to attend the March 11 rally, hoping to persuade the Netherlands’ hundreds of thousands of dual citizens to vote for the new constitution giving Erdogan greater powers.

Authorities in Gaggenau evacuated the city hall for hours on Friday after receiving a bomb threat, its mayor told n-tv German television. Asked if it was linked to the cancellation, mayor Michael Pfeiffer said: “We presume this at the moment, but we don’t know for sure.”

In a phone call between Turkish Foreign Minister Mevlut Cavusoglu and his German counterpart Sigmar Gabriel, the ministers agreed to meet in Germany on March 8 to discuss tensions between the two countries, foreign ministry sources in Ankara said.

Journalist Yucel, a German-Turkish dual national, is charged with propaganda in support of a terrorist organization. The German foreign ministry said it had not yet been granted consular access to Yucel or five other Germans arrested since the July 15 coup attempt.

German Justice Minister Heiko Maas sent Bozdag a sharply worded letter after Bozdag canceled their Thursday meeting.

“When journalists, judges and attorneys are arrested simply because they are doing their jobs, simply because they are fulfilling their role in a constitutional state, then each arrest marks a degradation of the rule of law,” he wrote.

“It is the role of the state to protect journalists and not burden them with repressive measures.”

Erdogan accuses an exiled cleric of masterminding the coup, describing his organization as the FETO terrorist group. Turkey also complains that Germany and other West European countries give succor to militant leftists and PKK Kurdish militants.

Germany is wary of rising tensions, seeking continued Turkish commitment to arrangements preventing large movements of refugees from Turkey to Europe.

(Additional reporting by Andrea Shalal in Berlin, Andreas Rinke in Tunis and Tuvan Gumrukcu in Ankara; editing by Andrew Roche)

U.S. carrier puts on show of ‘commitment’, not power, in South China Sea

U.S. Navy personnel prepare to launch an F18 fighter jet on the deck of USS Carl Vinson in the South China Sea. REUTERS/Erik De Castro

By Manuel Mogato

ABOARD THE USS CARL VINSON, South China Sea (Reuters) – The flight deck of the USS Carl Vinson shakes as a succession of F-18 fighter jets are catapulted into take-off, emitting a thunderous noise and leaving white mist in their wake.

Crewmen aboard the aircraft carrier scramble to prepare for the next arrival in a frenetic cycle of take-offs and landings involving dozens of aircraft, a dramatic display of American power in the hotly contested South China Sea.

The USS Carl Vinson led a carrier strike group on Friday in waters some 400 nautical miles east of China’s Hainan Island and northeast of the Paracels, the island chain occupied by Beijing since it seized control from Vietnam in the 1970s.

China claims most of the South China Sea through which about $5 trillion in ship-borne trade passes every year. Neighbors Brunei, Malaysia, the Philippines, Taiwan and Vietnam also have claims.

China’s growing military presence in the waters has fueled concern in the West, with the United States criticizing its militarization of maritime outposts and holding regular air and naval patrols to ensure freedom of navigation.

Tension between the United States and China over trade and territory under U.S. President Donald Trump has been stepped up of late, with fear in the region that the South China Sea, vital to global trade, could become a battleground between the two rival powers.

Some 30 fighter jets, helicopters and other aircraft took to the sky on Friday and crew in color-coded uniform raced to service them, check their instruments and fit weapons. An overpowering smell of aircraft fuel lingered in the air.

At any given time, between eight and 25 aircraft are in the air, day and night, with 15-20 on standby.

USS Carl Vinson has been on patrol since Feb. 19 in the South China Sea, amid some confusion about U.S. staying power in the region under a Trump administration with policies skewed heavily towards a domestic agenda.

Comments so far by Washington have caused alarm, most notably those by Secretary of State Rex Tillerson, who suggested during his Senate hearing that China be blocked from accessing the islands it has built and fortified with surface-to-air missiles.

Rear Admiral James Kilby, the strike group commander, said the patrol was not a show of power, but a demonstration of U.S. commitment to the Asia-Pacific.

“We wanted to reassure our friends and allies and our belief in the freedom of navigation and security operations that we always conducted,” he reporters flown out to the carrier on Friday.

“We have operated in the past, and we will continue to operate in the future. We continued to demonstrate that the international waters are waters where everyone can sail.”

TESTING THE WATERS

Under former President Barack Obama’s pivot to Asia, Washington sought to challenge China’s growing assertiveness through FONOPS, or Freedom of Navigation Operations, which routinely riled Beijing, particularly those close to its seven artificial islands.

Some critics say the FONOPS have been both provocative and fruitless, having failed to deter China from building up what it considers legitimate defenses.

A top Chinese official last year warned that FONOPS could “end in disaster”.

Friday’s exercise was far from the disputed areas of the waterway, rich fishing grounds which contain largely unexplored oil and gas deposits. Kilby there were “contacts” with merchant, fishing and military vessels in the past two weeks, though no “incidents”. He did not elaborate.

China has been guarded in its response to the latest U.S. mission, which started one day after Beijing finished its own aircraft carrier exercises.

It said it respected freedom of navigation and hoped the United States could “contribute positive energy towards this good situation”.

The crew aboard Carl Vinson will spend five months in Asia.

During Friday’s drills, one fighter missed its landing, or “recovery”, and was made to repeat the exercise, circling the vast ship before making a perfect landing.

Captain Douglas Verissimo, the skipper of Vinson, said the exercises included rigorous checks. Aircraft were simulating combat and bombing runs, performing over and over until flaws were ironed out.

“Every time they land, there’s someone grading them,” he said.

(Writing by Martin Petty; Editing by Nick Macfie)

China hints at trade war strategy in South Korea standoff

A barbed-wire fence is set up around a golf course owned by Lotte, where the U.S. Terminal High Altitude Area Defense (THAAD) system will be deployed, in Seongju, South Korea, March 1, 2017. Kim Joon-beom/Yonhap via REUTERS

By Adam Jourdan

SHANGHAI (Reuters) – South Korean firms are being squeezed in China, in suspected retaliation for Seoul’s deployment of a U.S. missile defense system, highlighting the tools China can deploy to hit back at the corporate interests of trade partners it disagrees with.

The chill facing Korea Inc, from cosmetics and supermarket chains to autos and tourism, points to a potential risk for American companies, amid a more confrontational stance taken by new U.S. President Donald Trump

In China, state media and grassroots political groups have led angry calls to boycott popular Korean products. Photos on social media and local news websites showed crowds vandalizing a Hyundai Motor Co <005380.KS> car, and some Chinese tourism firms moved to cancel Korean tours.

Beijing is furious over a joint plan by South Korea and the United States to set up the Terminal High Altitude Area Defence (THAAD) missile system in South Korea. Seoul and Washington say it will defend against nuclear-armed North Korean missiles. But Beijing says its far-reaching radar is targeted at China.

The furor echoes protests in 2012 against Japanese firms during a row with Tokyo over disputed islands in the East China Sea. The dispute flared on Monday when Lotte approved a land-swap deal that moved the THAAD system closer to deployment.

On Thursday, Lotte Duty Free, an affiliate of Korean conglomerate Lotte Group, said it had been the target of a suspected Chinese cyber attack.

“What’s happening to Korean companies now is a pretty good playbook for what might happen to U.S. firms over the next year,” said Andrew Gilholm, director of analysis for China and North Asia at risk consultancy Control Risks.

“Rather than the big dramatic trade war, everything goes to hell scenario under Trump, it’s probably more likely to be manifested as regulatory harassment of companies – one of the lower intensity tools for China.”

Korean stocks plunged on Friday, hitting cosmetics giant Amorepacific Corp <090430.KS>, carmaker Hyundai, and airlines Jeju Air Co Ltd <089590.KS>, Korean Air Lines Co Ltd <003490.KS> and Asiana Airlines Inc <020560.KS>.

POLITICAL PRESSURE

Some companies hinted at feeling political pressure to loosen or cut ties with South Korea. Korean media reported China had ordered tour operators in Beijing to stop selling trips to the country.

Three major Chinese tour operators Reuters spoke to, including China Youth Travel Service <600138.SS>, said they were still offering Korean tours. A customer service worker at Tuniu Corp <TOUR.O>, however, said the firm had stopped providing tours to Korea, citing the THAAD controversy. Tuniu did not respond to requests for comment.

Lotte also said searches for its products had been disrupted on major e-commerce platform JD.com Inc <JD.O>, though it did not directly say this was due to diplomatic tensions. JD.com declined to comment.

The CEO of Chinese retailer Jumei.com posted on his official microblog that his firm would no longer sell Lotte products. The firm did not respond to Reuters requests for comment.

“Some retailers have removed Lotte sales channels over the last week as a result of political pressure,” said a senior China-based retail industry executive, asking not to be named because of the sensitivity of the issues.

The Communist Party Youth League at central and local levels also fanned the flames online, calling for consumers not to buy products including cars, cosmetics and electronics.

“We say ‘no’ to Lotte!” the national-level Communist Youth League wrote in a post on its official microblog page.

‘IT’S BEING COORDINATED’

The consumer backlash followed. The number of posts mentioning Lotte’s Chinese name spiked to nearly 300,000 on Thursday from a normal level of a few thousand.

Photos posted on Chinese social media showed a large group of people surrounding a smashed up Hyundai car covered with black graffiti, prompting alarm over a repeat of issues that have hit faced Japanese carmakers. Other posts circulated online called for a blanket ban on all Korean tours.

China’s tourism administration posted a statement about South Korean “travel tips” on Friday, reminding Chinese holiday-makers “to soberly understand the risks of traveling abroad and carefully choose their travel destinations.”

The administration did not comment on any travel ban.

The normally hawkish state-run tabloid Global Times even struck a note of caution on Friday, warning vandalism of Korean products “won’t win the support of mainstream public opinion”.

However, Gilholm added the wide spectrum of measures taken against South Korea was unusually aggressive and authorities – though staying officially on the sidelines – played a role.

“For it to happen nationwide in such a short space of time it’s clearly been coordinated. You don’t see that being announced or admitted, but it’s being coordinated,” he said.

The Global Times warned last November the United States could face such a coordinated campaign. If Donald Trump triggered a trade war with China, Beijing would then target firms from Boeing <BA.N> to Apple <APPL.O> in a “tit-for-tat” approach.

“If Trump wrecks Sino-U.S. trade, a number of U.S. industries will be impaired,” it said in an editorial.

(Additional reporting by Cate Cadell and Xu Muyu in BEIJING, SHANGHAI newsroom. Editing by Bill Tarrant.)

Germany says to keep soldiers in Baltics as long as needed

German Foreign minister Sigmar Gabriel speaks during a news conference in Riga, Latvia, March 1, 2017. REUTERS/Ints Kalnins

RUKLA, Lithuania/AMARI, Estonia (Reuters) – German Foreign Minister Sigmar Gabriel on Thursday criticized Russia’s military build-up on its borders with the Baltic states as irrational and said Germany would keep troops in the region for as long as needed.

Gabriel visited about 400 German soldiers stationed in Rukla, Lithuania, as part of a German-led battle group of 1,000 troops that will be joined this year by a U.S.-led forces in Poland, British-led soldiers in Estonia and Canadian-led troops in Latvia.

NATO is expanding its presence in the region to levels unprecedented since the Cold War, prompted by Russia’s annexation of Crimea and accusations – denied by Moscow – that it is supporting a separatist conflict in eastern Ukraine.

The NATO presence will swell further for a series of exercises this summer, but is dwarfed by the Russian military build-up, U.S. officials say.

“The military potential that the Russian Federation has built up here at the border is completely irrational in my view because there is zero threat emanating from these countries,” Gabriel told reporters.

Gabriel gave no further details, but said the German troops would remain at the Lithuanian base “as long as needed”.

Russia has said it has noticed German soldiers deploying along its borders for the first time since World War Two and said it views the deployment of NATO troops and military hardware to the Baltic states as a threat.

Moscow has described its own military deployments as being either defensive and a direct response to NATO, or as part of a sweeping program to modernize its armed forces.

“SOLID PROTECTION”

German Defense Minister Ursula von der Leyen, who visited the Lithuanian base last month after the German troops arrived, told reporters at an air base in Amari, Estonia, that Germany was committed to ensuring the safety of the region.

German air force units have been stationed in Estonia to provide air defense since 2005 but their presence was increased in 2014 for air policing operations.

“Estonia, and our friends from Lithuania, Latvia and Poland, can rely on us,” von der Leyen said. “We Germans know what it means to be at the eastern border and to have the solid protection of the alliance.”

Von der Leyen and Gabriel both addressed concerns about increasing Russian disinformation campaigns after a fake report surfaced about a Lithuanian being raped by German troops that NATO said was traced to Russia.

“No one expects a real military confrontation to happen here, but what there is, and what has been reported in Lithuania, Latvia and Estonia, are attempts at massive disinformation and influence campaigns,” Gabriel said.

Von der Leyen said Germany and Europe were seeing clear signs of “efforts to destabilize” similar to Russian interference in the U.S. presidential election reported by U.S. intelligence services.

“That is why it is so important that we investigate these cases, put them on the table and make them public so we can recognize the patterns,” she said.

Russia has categorically denied it ran an influence campaign designed to sway the U.S. presidential election and has dismissed as absurd allegations it intends to meddle in European elections this year.

Such allegations are motivated by a desire to whip up anti-Russian sentiment and are being used by Western politicians to distract voters from pressing domestic problems, says Moscow.

(Reporting by Sabine Siebold in Rukla and David Mardiste in Amari; Writing by Andrea Shalal; editin by Janet Lawrence and Richard Lough)

China reacts with anger, threats after South Korean missile defense decision

FILE PHOTO: A Terminal High Altitude Area Defense (THAAD) interceptor is launched during a successful intercept test, in this undated handout photo provided by the U.S. Department of Defense, Missile Defense Agency. U.S. Department of Defense, Missile Defense Agency/Handout via Reuters/File Photo

BEIJING (Reuters) – Chinese state media have reacted with anger and boycott threats after the board of an affiliate of South Korea’s Lotte Group approved a land swap with the government that allows authorities to deploy a U.S. missile defense system.

The government decided last year to deploy the U.S. Terminal High Altitude Area Defense (THAAD) system, in response to the North Korean missile threat, on land that is part of a golf course owned by Lotte in the Seongju region, southeast of Seoul.

The board of unlisted Lotte International Co Ltd approved the deal with the government on Monday.

China objects to the deployment in South Korea of the THAAD, which has a powerful radar capable of penetrating Chinese territory, with Beijing saying it is a threat to its security and will do nothing to ease tension with North Korea.

Lotte should be shown the door in China, the influential state-run Chinese tabloid the Global Times said in an editorial on Tuesday.

“We also propose that Chinese society should coordinate voluntarily in expanding restrictions on South Korean cultural goods and entertainment exports to China, and block them when necessary,” it said in its English-language edition.

The paper’s Chinese version said South Korean cars and cellphones should be targeted as well.

“There are loads of substitutes for South Korean cars and cellphones,” it said.

China has already twice issued “solemn representations” to South Korea about the most recent THAAD-related developments, Chinese Foreign Ministry spokesman Geng Shuang told a daily briefing in Beijing.

But it welcomes foreign companies to operate in China, he said. “Whether or not a foreign company can operate successfully in China, in the end is a decision for the Chinese market and consumer,” he added.

Late on Monday, the ruling Communist Party’s official People’s Daily said cutting diplomatic ties should be considered.

“If THAAD is really deployed in South Korea, then China-South Korea relations will face the possibility of getting ready to cut off diplomatic relations,” it said on the WeChat account of its overseas edition.

The official Xinhua news agency also said in a commentary late on Monday that China “did not welcome this kind of Lotte”.

“Chinese consumers can absolutely say no to this kind of company and their goods based on considerations of ‘national security’,” it said.

South Korea’s defence ministry said on Tuesday it had signed a land swap deal, with Lotte exchanging the golf course for military property. A South Korean military official told Reuters the military would begin area patrols and install fences.

The Lotte Group said on Feb. 8 Chinese authorities had stopped construction at a multi-billion dollar real estate project in China after a fire inspection, fuelling concern in South Korea about damage to commercial ties with the world’s second-largest economy.

Asked if South Korea had demanded the Chinese government suspend any economic retaliation, South Korean Defence Ministry spokesman Moon Sang-kyun said: “We have continuously persuaded China so far and will keep continuing efforts to do so.”

South Korean government officials have said THAAD is a defensive measure against North Korean threats and does not target any other country.

South Korea’s central bank said this month the number of Chinese tourists visiting the tourist island of Jeju had fallen 6.7 percent over the Lunar New Year holiday from last year, partly because of China’s “anti-South Korea measures due to the THAAD deployment decision”.

(Reporting by Ben Blanchard; Additional reporting by Ju-min Park in SEOUL; Editing by Paul Tait and Clarence Fernandez)

North Korea evades sanctions with network of overseas companies: U.N. report

FILE PHOTO - A North Korean flag flies on a mast at the Permanent Mission of North Korea in Geneva October 2, 2014. REUTERS/Denis Balibouse/File Photo

By James Pearson

(Reuters) – North Korea is evading international sanctions with a sophisticated network of overseas companies, enabled partly by its continued access to the international banking system, says a forthcoming United Nations report seen by Reuters.

North Korea is under heavy U.N. sanctions and a strict arms embargo designed to impede the development of its banned nuclear and missile programs. The U.N. panel of experts, which produced the 100-page draft report, was created to investigate reported infringements of those sanctions.

“Designated entities and banks have continued to operate in the sanctioned environment by using agents who are highly experienced and well trained in moving money, people and goods, including arms and related materiel, across borders,” the report says.

U.N. member states should “exercise heightened vigilance” over North Korean diplomats engaged in commercial activities, it says, because some may be providing financial support to illegal networks.

North Korea “is flouting sanctions through trade in prohibited goods, with evasion techniques that are increasing in scale, scope and sophistication,” the report says.

It details a previously unknown interdiction of North Korean-made military communications equipment destined for Eritrea in July last year.

The interdiction was the second time North Korean military equipment bound for Eritrea had been intercepted, indicating an ongoing arms trade between the two countries, the report said.

The seized equipment, part of an air shipment, included 45 boxes of battlefield radios and accessories, the report says.

The radios were manufactured by a Malaysia-based front company called “Glocom”, which is controlled by the Reconnaissance General Bureau, the sanctioned North Korean intelligence agency tasked with overseas operations and weapons procurement, the report says.

INTELLIGENCE AGENCY

The report identifies two North Korean trading companies which, according to an unidentified U.N. member state, are linked to sanctioned entities, including the Reconnaissance General Bureau.

The report also outlines North Korea’s use of the financial system to pay for its sanctioned operations.

“Behind these illicit activities is the continued access of the Democratic People’s Republic of Korea to the international banking system,” the report says, using North Korea’s official title.

“Despite strengthened financial sanctions in 2016, the country’s networks are adapting by using greater ingenuity in accessing formal banking channels,” the report said.

In cases where financial access is more restricted, North Korean agents use bulk cash and gold to circumvent the financial system entirely, and at times use foreign citizens as middlemen and facilitators.

The report says North Korea continues to export banned minerals despite last year’s sanctions putting a cap on coal exports, a key source of hard currency for the state’s nuclear and missile programs.

China has said it would ban coal imports from North Korea until the end of the year. On Thursday, North Korea issued a rare reproach of China, its main diplomatic backer, over the ban.

The U.N. report says enforcement of sanctions against North Korea “remains insufficient and highly inconsistent” and calls for additional measures to address shortcomings.

(Reporting By James Pearson; Editing by Bill Tarrant)

China say North Korea’s nuclear plan is a problem between U.S. and North Korea

North Korean leader Kim Jong Un watches a performance given with splendor at the People's Theatre on Wednesday to mark the 70th anniversary of the founding of the State Merited Chorus in this photo released by North Korea's Korean Central News Agency (KCNA) in Pyongyang on February 23, 2017. KCNA/via REUTERS

BEIJING (Reuters) – China on Friday dismissed renewed pressure from U.S. President Donald Trump over its role in North Korea, saying the crux of the matter was a dispute between Washington and Pyongyang.

Trump told Reuters in an interview on Thursday that China could solve the national security challenge posed by North Korea “very easily if they want to”, turning up pressure on Beijing to exert more influence to rein in Pyongyang’s increasingly bellicose actions.

China has made clear that it opposes North Korea’s nuclear and missile programs and has repeatedly called for denuclearization of the Korean peninsula and a return to negotiations between Pyongyang and world powers.

It has also insisted it is dedicated to enforcing U.N. sanctions against North Korea.

“We have said many times already that the crux of the North Korean nuclear issue is the problem between the United States and North Korea,” Chinese Foreign Ministry spokesman Geng Shuang told a daily news briefing, responding to Trump’s remarks.

“We hope the relevant parties can shoulder their responsibilities, play the role the should, and together with China play a constructive role for peace and stability on the Korean peninsula and for its denuclearization,” he added.

The official Xinhua news agency said China’s influence on North Korea had been exaggerated.

“The Trump White House needs to make the first move and talk to Pyongyang. The United States stands to lose nothing for trying this,” it said in an English-language commentary.

China announced on Saturday last week it was banning imports of coal from North Korea, after it tested an intermediate-range ballistic missile.

North Korean state media issued a rare reproach of China on Thursday saying its main diplomatic backer was “dancing to the tune” of the United States for halting its coal imports because of its nuclear and missile programs.

The North’s state-run KCNA news agency did not refer directly to China by name but in an unmistakable censure it accused a “neighboring country” of going along with North Korea’s enemies to “bring down its social system”.

Asked about the report, Geng said the U.N. sanctions were a clear signal of opposition from the international community about North Korea’s nuclear and missile programs and that China would enforce them.

However, he also described China and North Korea as being friendly neighbors.

“We are willing to work with North Korea to promote the stable and healthy development of relations,” Geng said, adding North Korea was well aware of China’s position on its nuclear program.

(Reporting by Ben Blanchard; Editing by Robert Birsel)