Tag Archives: North Korea

Exclusive: From Russia with fuel – North Korean ships may be undermining sanctions

Exclusive: From Russia with fuel - North Korean ships may be undermining sanctions

By Polina Nikolskaya

MOSCOW (Reuters) – At least eight North Korean ships that left Russia with a cargo of fuel this year headed for their homeland despite declaring other destinations, a ploy that U.S. officials say is often used to undermine sanctions.

Reuters has no evidence of wrongdoing by the vessels, whose movements were recorded in Reuters ship-tracking data. Changing a ship’s destination once underway is not forbidden and it is unclear whether any of the ships unloaded fuel in North Korea.

But U.S. officials say that changing destination mid-voyage is a hallmark of North Korean state tactics to circumvent the international trade sanctions imposed over Pyongyang’s nuclear weapons program.

Changing course and the complex chain of different firms –many offshore — involved in shipments can complicate efforts to check how much fuel is supplied to North Korea and monitor compliance with a cap on fuel imports under U.N. sanctions.

“As part of North Korea’s efforts to acquire revenue, the regime uses shipping networks to import and export goods,” U.S. Assistant Secretary of the Treasury Marshall S. Billingslea told the Congressional Foreign Affairs Committee this month.

“North Korea employs deceptive practices to conceal the true origins of these goods. Pyongyang has been found to routinely falsify a vessel’s identity and documentation.”

VOYAGE OF THE MA DU SAN

The eight vessels identified in the tracking data set sail from the Far Eastern Russian port of Vladivostok or nearby Nakhodka and registered China or South Korea as their destination with the Information System for State Port Control.

After leaving Russia, they were next recorded off the North Korean ports of Kimchaek, Chongjin, Hungnam or Najin. None went on to China and most went back to Russia.

All had a cargo of diesel, a source at the company that services vessels in Vladivostok said. Their cargo capacity ranged from 500 tonnes to 2,000 tonnes.

One of the vessels was the Ma Du San, owned by North Korea’s Korea Kyongun Shipping Co. It took on a cargo of 545 tonnes of marine fuel at Vladivostok’s Pervaya Rechka terminal, owned by Russia’s Independent Petroleum company (IPC).

Reuters obtained a bill of lading — a receipt for goods issued when a ship loads up — dated May 19 showing the Ma Du San’s cargo came from Khabarovskiy NPZ, a refinery owned by IPC.

The ship set sail on May 20. Documents filed with Russia’s Information System for State Port Control stated its next destination as the Chinese port of Zhanjiang and the bill of lading showed it as Busan in South Korea.

The Ma Du San’s next recorded location after Vladivostok was inside the perimeter of the port of Kimchaek — all the other ships were tracked only in the vicinity of ports. North Korean ships intermittently turn off their transponders, and satellites cannot track them at such times, U.S. officials say.

Allegations outlined in two U.S. Treasury Department sanctions orders and a legal complaint filed by the U.S. government match the information Reuters obtained on the Ma Du San though the U.S. documents do not name the vessel involved.

SANCTIONS BLACKLIST

On June 1, the U.S. Treasury Department included IPC on its sanctions blacklist, saying it provided oil to North Korea and may have been involved in circumventing sanctions.

On Aug. 22, the U.S. government sanctioned two more companies, both registered in Singapore — Transatlantic Partners and Velmur Management Pte. Ltd.

The legal complaint, also filed on Aug. 22, accused the two firms of money laundering on behalf of sanctioned North Korean banks seeking to buy petroleum products, citing a bill of lading for May 19 for a cargo of diesel sold by IPC to Velmur and loaded in Vladivostok — the same date as the bill of lading for the Ma Du San.

Andrey Serbin, who represents Transatlantic Partners, said the firm had not received payments from a sanctions-hit bank and that ownership of the fuel changed after it was loaded.

“We sold the fuel to a Chinese company,” Serbin, who has been blacklisted by the U.S. government for “operating in the energy industry in the North Korean economy” and working to purchase fuel for delivery to North Korea, said of several shipments where the company acted as middleman.

“There’s no way we can control them (the goods),” he said.

Serbin did not identify the vessels Transatlantic Partners loaded fuel on to, but a source in a company that services ships in Vladivostok said the Ma Du San was among them.

The bill of lading named the recipient of the Ma Du San’s cargo as a company called LLC Sky Shipping Limited. Reuters was unable to find any record of such a firm.

Velmur said it could not have known where the cargo would end up and did not knowingly help anyone dodge sanctions.

IPC did not respond to a request for comment. Its parent company, Bermuda-registered Alliance Oil Company Ltd., denied having any contractual relations with North Korean companies when U.S. sanctions were imposed on IPC.

The U.S. Treasury and State departments declined to answer questions about Reuters’ findings.

Russia’s foreign ministry did not respond to questions about fuel exports to North Korea but has said Russia complies with the sanctions. Russia’s customs service said it could not provide information about movement of goods across borders.

Since the U.S. sanctions were imposed on IPC, all North Korean-flagged vessels that had been in Vladivostok port have left, according to the tracking data.

They departed with no cargo, an employee with a shipping agent in Vladivostok said. This is confirmed by documents seen by Reuters.

Russian supplies of oil and oil products to North Korea are much smaller than volumes shipped by China, Pyongyang’s only major ally. Beijing has acted to reduce the flows, but Russia’s trade in all goods with North Korea more than doubled in the first quarter of 2017 to $31.4 million.

Moscow’s trade with Pyongyang is under closer scrutiny following a series of missile launches by North Korea and a test involving what it said was a hydrogen bomb.

(Additional reporting by David Brunnstrom in WASHINGTON, Chen Aizhu in BEIJING, James Pearson in SEOUL, Katya Golubkova, Gleb Stolyarov, Vladimir Soldatkin and Olesya Astakhova in MOSCOW; Editing by Christian Lowe and Timothy Heritage)

Trump vows if threatened to ‘totally destroy’ North Korea

Trump vows if threatened to 'totally destroy' North Korea

By Steve Holland and Jeff Mason

UNITED NATIONS (Reuters) – U.S. President Donald Trump escalated his standoff with North Korea over its nuclear challenge on Tuesday, threatening to “totally destroy” the country of 26 million people and mocking its leader, Kim Jong Un, as a “rocket man.”

In a hard-edged speech to the United Nations General Assembly, Trump offered a grim portrait of a world in peril, adopted a more confrontational approach to solving global challenges from Iran to Venezuela, and gave an unabashed defense of U.S. sovereignty. (http://live.reuters.com/Event/Live_US_Politics/1092226107)

“The United States has great strength and patience, but if it is forced to defend itself or its allies, we will have no choice but to totally destroy North Korea,” Trump told the 193-member world body, sticking closely to a script.

As loud, startled murmurs filled the hall, Trump described Kim in an acid tone, saying, “Rocket man is on a suicide mission for himself and his regime.”

His remarks rattled world leaders gathered in the green-marbled U.N. General Assembly hall, where minutes earlier U.N. Secretary-General Antonio Guterres appealed for statesmanship, saying: “We must not sleepwalk our way into war.”

Trump’s most direct military threat to attack North Korea, in his debut appearance at the General Assembly, was his latest expression of concern about Pyongyang’s repeated launching of ballistic missiles over Japan and underground nuclear tests.

His advisers say he is concerned about North Korea’s advances in missile technology and the few means available for a peaceful response without China’s help.

Inside the hall, one man in the audience covered his face with his hands shortly after Trump made his “totally destroy” comment. Swedish Foreign Minister Margot Wallstrom crossed her arms.

“It was the wrong speech, at the wrong time, to the wrong audience,” Wallstrom later told the BBC.

Trump did not back down, instead tweeting out the line in his speech vowing to destroy North Korea if needed.

A junior North Korean diplomat sat in the delegation’s front-row seat for Trump’s speech, the North Korean U.N. mission said. North Korea’s mission to the United Nations did not immediately respond to a request for comment.

In Germany, Chancellor Chancellor Angela Merkel said she would do everything in her power to ensure a diplomatic solution. “Anything else would lead to disaster,” she told a campaign event ahead of Sunday’s election.

CABINET CONTRAST

Trump’s saber-rattling rhetoric, with the bare-knuckled style he used to win election last November, was in contrast to the comments of some of his own Cabinet members who have stated a preference for a diplomatic solution.

Reaction around the United States was mixed. Mitt Romney, the 2012 Republican presidential nominee, tweeted that Trump, a fellow Republican, “gave a strong and needed challenge” to U.N. members to confront global challenges.

But Democrat Ed Markey of the U.S. Senate Foreign Relations Committee denounced Trump’s remarks in a CNN interview, saying the president had yet to exhaust his other options in encouraging Pyongyang to negotiate.

“The least we should be able to say is that we tried, we really tried, to avoid a nuclear showdown between our two countries,” Markey said.

In a thunderous 41-minute speech, Trump also took aim at Iran’s nuclear ambitions and regional influence, Venezuela’s collapsing democracy and the threat of Islamist extremists and criticized the Cuban government.

⁠⁠⁠⁠⁠ “Major portions of the world are in conflict and some in fact are going to hell,” he said.

His speech recalled the fiery nationalist language of his Jan. 20 inaugural address when he pledged to end what he called an “American carnage” of rusted factories and crime.

‘HOSTILE’ BEHAVIOR

His strongest words were directed at North Korea. He urged U.N. member states to work together to isolate the Kim government until it ceases its “hostile” behavior.

In what may have been a veiled prod at China, the North’s major trading partner, Trump said: “It is an outrage that some nations would not only trade with such a regime but would arm, supply and financially support a country that imperils the world with nuclear conflict.”

The U.N. Security Council has unanimously imposed nine rounds of sanctions on North Korea since 2006 and Guterres appealed for that 15-member body to maintain its unity.

Turning to Iran, Trump called the 2015 nuclear deal negotiated by his predecessor, Barack Obama, an embarrassment and hinted that he may not recertify the agreement when it comes up for a mid-October deadline.

“I don’t think you’ve heard the last of it,” he said.

He called Iran an “economically depleted rogue state” that exports violence.

There was no immediate comment from either Iran’s U.N. delegation or its foreign ministry in Tehran.

But French President Emmanuel Macron, in his U.N. speech, said his country would not close the door to negotiations over North Korea and staunchly defended the 2015 Iran nuclear deal. “Renouncing it would be a grave error,” Macron said.

Trump called the collapsing situation in Venezuela “completely unacceptable” and warned the United States was considering what further actions it can take. “We cannot stand by and watch,” he said.

Venezuela rejected Trump’s threats and said it was prepared to resist any U.S. actions, even a military invasion. Foreign Minister Jorge Arreaza called Trump a white supremacist who was returning the world to the Cold War of the 1980s.

Financial markets showed little reaction to the speech, with most major assets hovering near the unchanged mark on the day.

“He stuck with his script,” said Lennon Sweeting, chief market strategist at XE.com in Toronto. “The dollar/yen jumped around a bit but it’s basically flat. I don’t think we will see any more volatility out of this.”

(Additional reporting by Michelle Nichols, Arshad Mohammed, John Irish, Parisa Hafezi, David Brunnstrom, Yara Bayoumy and Anthony Boadle at the UNITED NATIONS, Richard Leong in NEW YORK and Dan Williams in JERUSALEM; Writing by Steve Holland; Editing by Howard Goller)

Trump to single out North Korea, Iran in first speech at U.N.

Trump to single out North Korea, Iran in first speech at U.N.

By Steve Holland and Jeff Mason

UNITED NATIONS (Reuters) – U.S. President Donald Trump will urge United Nations member states on Tuesday to turn up the pressure on North Korea to give up its nuclear weapons, using his maiden speech to the world body to address what he considers the top global challenge.

Senior White House officials said Trump would also target Iran’s nuclear program, single out Venezuela for criticism and refer to Islamist militants as “losers,” in his first appearance in the green-marbled U.N. General Assembly hall, where applause from world leaders is generally muted.

“Big day at the United Nations – many good things, and some tricky ones, happening. We have a great team,” Trump wrote in an early morning post on Twitter that also noted his “big speech.”

The speech, scheduled for 10:30 a.m. ET (1430 GMT), will mark his latest attempt to lay out his America First vision for a U.S. foreign policy aimed at downgrading global bureaucracies, basing alliances on shared interests, and steering Washington away from nation-building exercises abroad.

Trump’s first major turn on the global platform offered by the United Nations has been dominated by Iran and North Korea, which have been the focus of his talks with other world leaders.

Now eight months in the White House, Trump also has found time to criticize the world body, alleging gross mismanagement and demanding that the United States, the largest donor to the United Nations, get more for its investment.

In his speech, he will seek to rally the world to help the United States and its Asian allies reduce North Korea to pariah status and pressure Iran to rein in everything from ballistic missile launches to interference in Syria.

With North Korean nuclear tests and missile launches stirring global tensions, the U.S. ambassador to the United States, Nikki Haley, has said that most non-military options have all but been exhausted.

The U.N. Security Council has imposed several rounds of sanctions on North Korea.

A senior White House official, briefing reporters on the contents of the speech, said Trump would single out North Korea for “destabilizing, hostile and dangerous behavior.”

North Korea’s official KCNA news agency said on Monday that the more sanctions that Washington and its allies imposed on Pyongyang, the faster it would move to complete its nuclear plans.

‘SHARED MENACE’

Trump will also voice concern about Iran, which aides say he considers in violation of the spirit of a 2015 deal negotiated by his Democratic predecessor, Barack Obama, and aimed at containing Iran’s nuclear program.

“Theirs is a shared menace and nations cannot be bystanders to history and if we don’t confront the threats now, they will only gather force and become more formidable,” the official said of North Korea and Iran.

Trump has set U.S.-Iran relations on a far more confrontational path than the detente Iranian President Hassan Rouhani enjoyed with Obama.

Trump’s rhetoric against Iran, coming as he appears to be leaning against recertifying the nuclear deal by a mid-October deadline, prompted a retort from Rouhani on Monday.

Rouhani told CNN that exiting the Iran nuclear deal “would carry a high cost for the United States of America, and I do not believe Americans would be willing to pay such a high cost for something that will be useless for them.”

Later on Tuesday, Trump is scheduled to meet with Emir of Qatar Sheikh Tamim bin Hamad al-Thani. White House officials have said Trump on Wednesday will meet with leaders from Jordan, the Palestinian Authority, Britain and Egypt.

Trump is using his four days in New York to voice his concern about Venezuela, telling Latin American leaders on Monday night the United States would take additional steps if Caracas moved toward authoritarian rule.

(Reporting by Steve Holland and Jeff Mason; Writing by Steve Holland; Editing by Yara Bayoumy and Howard Goller)

Korean peninsula draws range of military drills in show of force against North Korea

North Korean leader Kim Jong Un watches the launch of a Hwasong-12 missile in this undated photo released by North Korea's Korean Central News Agency (KCNA) on September 16, 2017. KCNA via REUTERS

By Ben Blanchard and Hyonhee Shin

BEIJING/SEOUL (Reuters) – The U.S. military staged bombing drills with South Korea over the Korean peninsula and Russia and China began naval exercises ahead of a U.N. General Assembly meeting on Tuesday where North Korea’s nuclear threat is likely to loom large.

The flurry of military drills came after Pyongyang fired another mid-range ballistic missile over Japan on Friday and the reclusive North conducted its sixth and most powerful nuclear test on Sept. 3 in defiance of United Nations sanctions and other international pressure.

A pair of U.S. B-1B bombers and four F-35 jets flew from Guam and Japan and joined four South Korean F-15K fighters in the latest drill, South Korea’s defense ministry said.

The joint drills were being conducted “two to three times a month these days”, Defence Minister Song Young-moo told a parliamentary hearing on Monday.

In Beijing, the official Xinhua news agency said China and Russia began naval drills off the Russian far eastern port of Vladivostok, not far from the Russia-North Korea border.

Those drills were being conducted between Peter the Great Bay, near Vladivostok, and the southern part of the Sea of Okhotsk, to the north of Japan, it said.

The drills are the second part of China-Russian naval exercises this year, the first part of which was staged in the Baltic in July. Xinhua did not directly link the drills to current tension over North Korea.

China and Russia have repeatedly called for a peaceful solution and talks to resolve the issue.

On Sunday, however, U.S. Ambassador to the United Nations Nikki Haley said the U.N. Security Council had run out of options on containing North Korea’s nuclear program and the United States might have to turn the matter over to the Pentagon.

In response, Chinese Foreign Ministry spokesman Lu Kang said the most pressing task was for all parties to enforce the latest U.N. resolutions on North Korea fully, rather than “deliberately complicating the issue”.

Military threats from various parties have not promoted a resolution to the issue, he said.

“This is not beneficial to a final resolution to the peninsula nuclear issue,” Lu told a daily news briefing.

U.S. President Donald Trump has vowed that North Korea will never be able to threaten the United States with a nuclear-tipped ballistic missile.

Asked about Trump’s warning last month that the North Korean threat to the United States would be met with “fire and fury”, Haley said: “It was not an empty threat.”

Washington has also asked China to do more to rein in its neighbor and ally, while Beijing has urged the United States to refrain from making threats against the North.

 

FUEL PRICES SURGE

The U.N. Security Council unanimously passed a U.S.-drafted resolution a week ago mandating tougher new sanctions against Pyongyang that included banning textile imports and capping crude and petrol supply.

North Korea on Monday called the resolution “the most vicious, unethical and inhumane act of hostility to physically exterminate” its people, system and government.

“The increased moves of the U.S. and its vassal forces to impose sanctions and pressure… will only increase our pace toward the ultimate completion of the state nuclear force,” the North’s foreign ministry spokesman said in a statement carried by its official KCNA news agency.

Gasoline and diesel prices in the North have surged since the latest nuclear test in anticipation of a possible oil ban, according to market data analyzed by Reuters on Monday.

The international community must remain united and enforce sanctions against North Korea after its repeated launch of ballistic missiles, Japanese Prime Minister Shinzo Abe said in an editorial in the New York Times on Sunday.

Such tests were in violation of Security Council resolutions and showed that North Korea could now target the United States or Europe, he wrote.

Abe also said diplomacy and dialogue would not work with North Korea and concerted pressure by the entire international community was essential to tackle the threats posed by the north and its leader, Kim Jong Un.

However, the official China Daily argued on Monday that sanctions should be given time to bite and that the door must be left open to talks.

“With its Friday missile launch, Pyongyang wanted to give the impression that sanctions will not work,” it said in an editorial. “Some people have fallen for that and immediately echoed the suggestion, pointing to the failure of past sanctions to achieve their purpose.

“But that past sanctions did not work does not mean they will not. It is too early to claim failure because the latest sanctions have hardly begun to take effect. Giving the sanctions time to bite is the best way to make Pyongyang reconsider,” the newspaper said.

Pyongyang has launched dozens of missiles as it accelerates a weapons program designed to provide the ability to target the United States with a powerful, nuclear-tipped missile.

It says such programs are needed as a deterrent against invasion by the United States, which has 28,500 troops stationed in South Korea. On Saturday, it said it aimed to reach an “equilibrium” of military force with the United States.

The United States and South Korea are technically still at war with North Korea because the 1950-53 Korean conflict ended with a truce and not a peace treaty.

 

(Reporting by Ben Blanchard in BEIJING, Hyonhee Shin and Soyoung Kim in SEOUL; Editing by Paul Tait and Simon Cameron-Moore)

 

North Korea says seeking military ‘equilibrium’ with U.S.

North Korea says seeking military 'equilibrium' with U.S.

By Christine Kim and Michelle Nichols

SEOUL/UNITED NATIONS (Reuters) – North Korea said on Saturday it aims to reach an “equilibrium” of military force with the United States, which earlier signaled its patience for diplomacy is wearing thin after Pyongyang fired a missile over Japan for the second time in under a month.

“Our final goal is to establish the equilibrium of real force with the U.S. and make the U.S. rulers dare not talk about military option,” North Korean leader Kim Jong Un was quoted as saying by the state news agency, KCNA.

Kim was shown beaming as he watched the missile fly from a moving launcher in photos released by the agency, surrounded by several officials.

“The combat efficiency and reliability of Hwasong-12 were thoroughly verified,” said Kim as quoted by KCNA. Kim added the North’s goal of completing its nuclear force had “nearly reached the terminal”.

North Korea has launched dozens of missiles under Kim’s leadership as it accelerates a weapons program designed to give it the ability to target the United States with a powerful, nuclear-tipped missile.

After the latest missile launch on Friday, White House National Security Adviser H.R. McMaster said the United States was fast running out of patience with North Korea’s missile and nuclear programs.

“We’ve been kicking the can down the road, and we’re out of road,” McMaster told reporters, referring to Pyongyang’s repeated missile tests in defiance of international pressure.

“For those … who have been commenting on a lack of a military option, there is a military option,” he said, adding that it would not be the Trump administration’s preferred choice.

Also on Friday, the U.N. Security Council condemned the “highly provocative” missile launch by North Korea.

It had already stepped up sanctions against North Korea in response to a nuclear bomb test on Sept. 3, imposing a ban on North Korea’s textile exports and capping its imports of crude oil.

The U.S. ambassador to the United Nations, Nikki Haley, echoed McMaster’s strong rhetoric, even as she said Washington’s preferred resolution to the crisis is through diplomacy and sanctions.

“What we are seeing is, they are continuing to be provocative, they are continuing to be reckless and at that point there’s not a whole lot the Security Council is going to be able to do from here, when you’ve cut 90 percent of the trade and 30 percent of the oil,” Haley said.

U.S. President Donald Trump said that he is “more confident than ever that our options in addressing this threat are both effective and overwhelming.” He said at Joint Base Andrews near Washington that North Korea “has once again shown its utter contempt for its neighbors and for the entire world community.”

MISSILE

North Korea’s latest test missile flew over Hokkaido in northern Japan on Friday and landed in the Pacific about 2,000 km (1,240 miles) to the east, the Japanese government said.

It traveled about 3,700 km (2,300 miles) in total, according to South Korea’s military, far enough to reach the U.S. Pacific territory of Guam, which the North has threatened before.

“The range of this test was significant since North Korea demonstrated that it could reach Guam with this missile,” the Union of Concerned Scientists advocacy group said in a statement. However, the accuracy of the missile, still at an early stage of development, was low, it said.

On Thursday, U.S. Secretary of State Tillerson called on China, Pyongyang’s only ally, and Russia to apply more pressure on North Korea by “taking direct actions of their own.”

Beijing has pushed back, urging Washington to do more to rein in North Korea.

“Honestly, I think the United States should be doing .. much more than now, so that there’s real effective international cooperation on this issue,” China’s ambassador to the United States, Cui Tiankai, said on Friday.

“They should refrain from issuing more threats. They should do more to find effective ways to resume dialogue and negotiation,” he said, while adding that China would never accept North Korea as a nuclear weapons state.

North Korea staged its sixth and most powerful nuclear bomb test earlier this month and in July tested long-range intercontinental ballistic missiles capable of reaching at least parts of the U.S. mainland.

Last month, North Korea fired an intermediate range missile that also flew over Hokkaido into the ocean.

Warning announcements about the latest missile blared in parts of northern Japan, while many residents received alerts on their mobile phones or saw warnings on TV telling them to seek refuge.

The U.S. military said it had detected a single intermediate range ballistic missile but it did not pose a threat to North America or Guam.

Global equities investors largely shrugged off the latest missile test by North Korea as shares on Wall Street set new highs on Friday.

DIFFERENCES OVER DIRECT TALKS

Trump has promised not to allow North Korea to threaten the United States with a nuclear-tipped missile.

Russia’s U.N. ambassador, Vassily Nebenzia, said the United States needed to begin talks with North Korea, something that Washington has so far ruled out.

“We called on our U.S. partners and others to implement political and diplomatic solutions that are provided for in the resolution,” Nebenzia told reporters after the Security Council meeting. “Without implementing this, we also will consider it as a non-compliance with the resolution.”

Asked about the prospect for direct talks, a White House spokesman said, “As the president and his national security team have repeatedly said, now is not the time to talk to North Korea.”

South Korean President Moon Jae-in also said dialogue with the North was impossible at this point. He ordered officials to analyze and prepare for possible new North Korean threats, including electromagnetic pulse and biochemical attacks.

The United States and South Korea are technically still at war with North Korea because the 1950-53 Korean conflict ended with a truce and not a peace treaty. The North accuses the United States, which has 28,500 troops in South Korea, of planning to invade and regularly threatens to destroy it and its Asian allies.

(Reporting by Jeff Mason and Michelle Nichols; Additional reporting by Hideyuki Sano, William Mallard, Tim Kelly and Chehui Peh in Tokyo, Jack Kim and Christine Kim in Seoul, Mohammad Zargham, Susan Heavey, Makini Brice and David Brunnstrom in Washington; Tom Miles in Geneva; Masha Tsvetkova and Polina Devitt in Moscow; Christian Shepherd in Beijing; Writing by Frances Kerry; Editing by Alistair Bell and Cynthia Osterman)

North Korea threatens to ‘sink’ Japan, reduce U.S. to ‘ashes and darkness’

North Korea threatens to 'sink' Japan, reduce U.S. to 'ashes and darkness'

By Jack Kim and Kiyoshi Takenaka

SEOUL/TOKYO (Reuters) – A North Korean state agency threatened on Thursday to use nuclear weapons to “sink” Japan and reduce the United States to “ashes and darkness” for supporting a U.N. Security Council resolution and sanctions over its latest nuclear test.

The Korea Asia-Pacific Peace Committee, which handles the North’s external ties and propaganda, also called for the breakup of the Security Council, which it called “a tool of evil” made up of “money-bribed” countries that move at the order of the United States.

“The four islands of the archipelago should be sunken into the sea by the nuclear bomb of Juche. Japan is no longer needed to exist near us,” the committee said in a statement carried by the North’s official KCNA news agency.

Juche is the North’s ruling ideology that mixes Marxism and an extreme form of go-it-alone nationalism preached by state founder Kim Il Sung, the grandfather of the current leader, Kim Jong Un.

Regional tension has risen markedly since the reclusive North conducted its sixth, and by far its most powerful, nuclear test on Sept. 3, following a series of missile tests, including one that flew over Japan.

The 15-member Security Council voted unanimously on a U.S.-drafted resolution and a new round of sanctions on Monday in response, banning North Korea’s textile exports that are the second largest only to coal and mineral, and capping fuel supplies.

The North reacted to the latest action by the Security Council, which had the backing of veto-holding China and Russia, by reiterating threats to destroy the United States, Japan and South Korea.

“Let’s reduce the U.S. mainland into ashes and darkness. Let’s vent our spite with mobilization of all retaliation means which have been prepared till now,” the statement said.

Japan’s Nikkei stock index and dollar/yen currency pared gains, although traders said that was more because of several Chinese economic indicators released on Thursday rather than a reaction to the North’s latest statement.

South Korea’s won also edged down around the same time over domestic financial concerns.

Despite the North’s threats, South Korean President Moon Jae-in said he was against having nuclear weapons in his country, either by developing its own arsenal or bringing back U.S. tactical nuclear weapons that were withdrawn in the early 1990s.

“To respond to North Korea by having our own nuclear weapons will not maintain peace on the Korean peninsula and could lead to a nuclear arms race in northeast Asia,” Moon said in an interview with CNN.

South Korea’s Unification Ministry also said it planned to provide $8 million through the U.N. World Food Programme and UNICEF to help infants and pregnant women in the North.

The move marks Seoul’s first humanitarian assistance for the North since its fourth nuclear test in January 2016 and is based on a longstanding policy of separating humanitarian aid from politics, the ministry said.

“DANCING TO THE TUNE”

The North’s latest threats also singled out Japan for “dancing to the tune” of the United States, saying it should never be pardoned for not offering a sincere apology for its “never-to-be-condoned crimes against our people”, an apparent reference to Japan’s wartime aggression.

It also referred to South Korea as “traitors and dogs” of the United States.

Japan criticized the North’s statement harshly.

“This announcement is extremely provocative and egregious. It is something that markedly heightens regional tension and is absolutely unacceptable,” Japanese Chief Cabinet Secretary Yoshihide Suga told reporters.

Japanese Prime Minister Shinzo Abe, visiting India, called for strict enforcement of the U.N. resolution, saying the world must force a change.

The 15-member Security Council voted unanimously on a U.S.-drafted resolution and a new round of sanctions against North Korea on Monday in response to its latest and most powerful test, banning North Korea’s textile exports that are the second largest only to coal and mineral, and capping fuel supplies.

North Korea had already rejected the Security Council resolution, vowing to press ahead with its nuclear and missile programs.

A tougher initial U.S. draft of Monday’s resolution was weakened to win the support of China, the North’s lone major ally, and Russia. Significantly, it stopped short of imposing a full embargo on oil exports to North Korea, most of which come from China.

The latest sanctions also make it illegal for foreign firms to form commercial joint ventures with North Korean entities.

U.S. President Donald Trump has vowed that North Korea will never be allowed to threaten the United States with a nuclear-tipped missile, but has also asked China to do more to rein in its neighbor. China in turn favors an international response to the problem.

Chinese Foreign Ministry spokeswoman Hua Chunying said the international community had reached a “high consensus” on trying to realize a peaceful solution.

“We urge the relevant directly involved parties to seize the opportunity and have the political nerve to make the correct political choice as soon as possible,” Hua told a regular press briefing.

The North accuses the United States, which has 28,500 troops in South Korea, of planning to invade and regularly threatens to destroy it and its Asian allies.

The United States and South Korea are technically still at war with North Korea because the 1950-53 Korean conflict ended with a truce and not a peace treaty.

(Additional reporting by Christian Shepherd in Beijing, Hyonhee Shin in Seoul, Sanjeev Miglani in New Delhi and Kiyoshi Takenaka in Tokyo; Editing by Paul Tait and Nick Macfie)

North Korea defiant over U.N. sanctions as Trump says tougher steps needed

North Korea defiant over U.N. sanctions as Trump says tougher steps needed

By Jack Kim and Roberta Rampton

SEOUL/WASHINGTON (Reuters) – North Korea showed trademark defiance on Wednesday over new U.N. sanctions imposed after its sixth and largest nuclear test, vowing to redouble efforts to fight off what it said was the threat of a U.S. invasion.

U.S. President Donald Trump said Monday’s sanctions, unanimously agreed on Monday by the 15-member U.N. Security Council, were just a small step towards what is ultimately needed to rein in Pyongyang over its nuclear and missile programs.

The North’s Foreign Ministry said the resolutions were an infringement on its legitimate right to self-defense and aimed at “completely suffocating its state and people through full-scale economic blockade”.

“The DPRK will redouble the efforts to increase its strength to safeguard the country’s sovereignty and right to existence and to preserve peace and security of the region by establishing the practical equilibrium with the U.S.,” it said in a statement carried by the official KCNA news agency.

DPRK stands for the Democratic People’s Republic of Korea, North Korea’s official name.

The statement echoed comments on Tuesday by the North’s ambassador to the United Nations in Geneva, Han Tae Song, who said Pyongyang was “ready to use a form of ultimate means”.

“The forthcoming measures … will make the U.S. suffer the greatest pain it ever experienced in its history,” Han said.

The North’s Rodong Sinmun newspaper also accused South Korea of being Washington’s “puppet”, criticizing Seoul’s agreement with the United States to amend an existing bilateral guideline that will now allow the South to use unlimited warhead payloads on its missiles.

The U.N. Security Council agreed to boost sanctions on North Korea, banning its textile exports and capping fuel supplies, and making it illegal for foreign firms to form commercial joint ventures with North Korean entities.

The U.N. resolution was triggered by North Korea’s test of what it said was a hydrogen bomb.

Damage to mountainous terrain at the North’s nuclear test site in Punggye-ri seen in satellite imagery taken after the latest test was more extensive than anything seen after the five previous tests, the Washington-based 38 North project said.

There was also activity at another location in the Mount Mantap site involving large vehicles and mining equipment that suggests “onsite work could now be changing focus to further prepare those other portals for future underground nuclear testing”, said 38 North, which monitors North Korea.

The North accuses the United States, which has 28,500 troops in South Korea, a legacy of the 1950-53 Korean war, of continual plans for invasion.

North Korea has also tested a missile capable of reaching the United States, but experts say it is likely to be at least a year before it can field an operational nuclear missile that could threaten the U.S. mainland.

ANOTHER SMALL STEP

Trump has vowed not to allow that to happen.

A tougher initial U.S. draft resolution was weakened to win the support of China and Russia, both of which hold U.N. veto power. Significantly, it stopped short of imposing a full embargo on oil exports to North Korea, most of which come from China.

“We think it’s just another very small step, not a big deal,” Trump told reporters at the start of a meeting with Malaysian Prime Minister Najib Razak.

“I don’t know if it has any impact, but certainly it was nice to get a 15-to-nothing vote, but those sanctions are nothing compared to what ultimately will have to happen.”

U.S. Treasury Secretary Steven Mnuchin warned China, North Korea’s main ally and trading partner, that Washington would “put additional sanctions on them and prevent them from accessing the U.S. and international dollar system” if it did not follow through on the new measures.

Another senior administration official told Reuters any such “secondary sanctions” on Chinese banks and other companies were on hold for now to give China time to show it was prepared to fully enforce the latest and previous rounds of sanctions.

Washington so far has mostly held off on new sanctions against Chinese banks and other companies doing business with North Korea, given fears of retaliation by Beijing and possibly far-reaching effects on the world economy.

Russia and China both say they respect U.N. sanctions and have called on the United States to return to negotiations with North Korea. They have also said they could kick-start talks with North Korea if the United States halts joint military drills with South Korea, which Washington has rejected.

An article carried on the front page of the People’s Daily, the official paper of China’s ruling Communist Party, said the Korean peninsula had reached the “moment of choice” where the United States and North Korea must break from the cycle of nuclear tests and sanctions.

“All parties involved in the peninsula have their own strategic considerations, but not being able to see beyond this vicious cycle is not in anyone’s interest,” the article said.

Asked about the North Korean and U.S. rhetoric, China’s foreign ministry reiterated a call for restraint and a return to dialogue.

“We hope all relevant parties can be rational and maintain restraint and not take actions that could further increase tensions on the peninsula,” ministry spokesman Geng Shuang said at a regular briefing.

In another show of force, South Korea’s Air Force conducted its first live-fire exercise of Taurus long-range, air-to-surface missiles on Tuesday, the defense ministry said, as practice for precision bombing North Korean facilities.

U.S. Ambassador to the United Nations Nikki Haley said the new sanctions could eventually starve North Korea of an additional $500 million or more in annual revenue.

The United States has said that a previous round of sanctions agreed in August was aimed at cutting North Korea’s $3 billion in exports by a third.

(Additional reporting by Christine Kim and Yuna Park in SEOUL, Michael Martina and Christian Shepherd in BEIJING, and Roberta Rampton and David Brunnstrom in WASHINGTON; Editing by Lincoln Feast, Paul Tait and Nick Macfie)

North Korea sanctions ‘nothing compared to what will have to happen’: Trump

U.S. President Donald Trump waits to greet Malaysia's Prime Minister Najib Razak at the White House in Washington, U.S. September 12, 2017. REUTERS/Jonathan Ernst

By Roberta Rampton

WASHINGTON (Reuters) – U.S. President Donald Trump said on Tuesday the latest U.N. sanctions on North Korea were only a very small step and nothing compared to what would have to happen to deal with the country’s nuclear program.

The U.N. Security Council unanimously voted to boost sanctions on North Korea on Monday, with its profitable textile exports now banned and fuel supplies capped, prompting a traditionally defiant threat of retaliation against the United States.

Monday’s decision, triggered by the North’s sixth and largest nuclear test this month, was the ninth such resolution unanimously adopted by the 15-member Security Council since 2006 over North Korea’s ballistic missile and nuclear programs.

A tougher initial U.S. draft was weakened to win the support of China, Pyongyang’s main ally and trading partner, and Russia, both of which hold veto power in the council. Significantly, it stopped short of imposing a full embargo on oil exports to North Korea, most of which come from China.

Trump told reporters at the start of a meeting with Malaysian Prime Minister Najib Razak that he was pleased Malaysia no longer did business with North Korea, before adding that he had just discussed the U.N. vote with Secretary of State Rex Tillerson.

“We think it’s just another very small step, not a big deal. … I don’t know if it has any impact, but certainly it was nice to get a 15-to-nothing vote.

“But those sanctions are nothing compared to what ultimately will have to happen,” he said without elaborating. Trump has vowed not to allow North Korea to possess a nuclear missile capable of hitting the United States.

U.S. Treasury Secretary Steven Mnuchin told a conference earlier on Tuesday that if China did not follow through on the new sanctions, “we will put additional sanctions on them and prevent them from accessing the U.S. and international dollar system.”

Washington so far has mostly held off on new sanctions against Chinese banks and other companies doing business with North Korea, given fears of retaliation by Beijing and possibly far-reaching effects on the world economy.

CHINA AND NORTH KOREA

Trump is likely to make a stop in China in November during his first official visit to Asia and Tillerson was due to hold talks later on Tuesday with China’s most senior diplomat, State Councilor Yang Jiechi, at which details of the trip are expected to be discussed, U.S. officials said.

The U.S. president has wavered between criticizing China for not doing enough on North Korea to heaping personal praise on the Chinese President Xi Jinping.

North Korea said its Sept. 3 test was of an advanced hydrogen bomb and was its most powerful by far.

Its ambassador to the United Nations in Geneva, Han Tae Song, rejected the resolution as “illegal and unlawful” and said Washington was “fired up for political, economic, and military confrontation.”

North Korea is “ready to use a form of ultimate means,” Han said. “The forthcoming measures … will make the U.S. suffer the greatest pain it ever experienced in its history.”

He did not elaborate, but North Korea frequently vows to destroy the United States.

The latest U.N. resolution also calls on countries to inspect vessels on the high seas, with the consent of the flag state, if they have reasonable grounds to believe ships are carrying prohibited cargo to North Korea.

It also bans joint ventures with North Korean entities, except for nonprofit public utility infrastructure projects, and prohibits countries from bringing in new North Korean workers.

On Tuesday, frustrated U.S. lawmakers called on Tuesday for a “supercharged” response to North Korea’s nuclear and missile tests, saying Washington should act alone if necessary to stiffen sanctions on companies from China and any country doing business with Pyongyang. [nL2N1LT10K}

Saying “time is running out,” Representative Ed Royce, the Republican chairman of the House of Representatives Foreign Affairs Committee said the United States should give Chinese banks and companies “a choice between doing business with North Korea or the United States.”

Assistant Treasury Secretary Marshall Billingslea acknowledged at a House hearing that he had not seen sufficient evidence past sanctions were effective, but defended the administration’s strategy.

He called on anyone aware of efforts to enable North Korean trade to come forward before getting caught. “We are closing in on North Korea’s trade representatives,” he said.

U.S. Ambassador to the United Nations Nikki Haley said the United States was “not looking for war” and if North Korea agreed to stop its nuclear program, it could “reclaim its future.”

“If North Korea continues its dangerous path, we will continue with further pressure,” said Haley, who credited a “strong relationship” between Trump and Chinese President Xi Jinping for the resolution.

She said the sanctions could eventually starve North Korea of an additional $500 million or more in annual revenue. The United States has said that a previous rounds of sanctions agreed in August were aimed at cutting North Korea’s $3 billion in exports by a third.

China’s official Xinhua news agency said in a commentary that the Trump administration was making a mistake by rejecting diplomatic engagement with North Korea.

“The U.S. needs to switch from isolation to communication in order to end an ‘endless loop’ on the Korean peninsula, where “nuclear and missile tests trigger tougher sanctions and tougher sanctions invite further tests,” it said.

(Restores dropped word “to” in first paragraph.)

(Additional reporting by Hyonhee Shin and Christine Kim in Seoul, David Lawder in Washington, Philip Wen in Beijing, Kaori Kaneko in Tokyo, David Brunnstrom in Washington and Stephanie Nebehay in Geneva; Editing by Nick Macfie and Jonathan Oatis)

U.N. Security Council steps up sanctions on defiant North Korea

U.N. Security Council steps up sanctions on defiant North Korea

By Michelle Nichols and Jack Kim

UNITED NATIONS/SEOUL (Reuters) – The U.N. Security Council unanimously voted to step up sanctions on North Korea, with its profitable textile exports now banned and fuel supplies capped, prompting a traditionally defiant threat of retaliation against the United States.

Monday’s decision, triggered by the North’s sixth and largest nuclear test this month, was the ninth such resolution unanimously adopted by the 15-member Security Council since 2006 over North Korea’s ballistic missile and nuclear programs.

Japan and South Korea said after the passage of the U.S.-drafted Security Council resolution they were prepared to apply more pressure if North Korea refused to end its aggressive development of nuclear weapons and ballistic missiles.

A tougher initial U.S. draft was weakened to win the support of China, Pyongyang’s main ally and trading partner, and Russia, both of which hold veto power in the council.

“We don’t take pleasure in further strengthening sanctions today. We are not looking for war,” U.S. Ambassador to the United Nations Nikki Haley told the council after the vote. “The North Korean regime has not yet passed the point of no return.

“If it agrees to stop its nuclear program, it can reclaim its future … If North Korea continues its dangerous path, we will continue with further pressure,” said Haley, who credited a “strong relationship” between U.S. President Donald Trump and Chinese President Xi Jinping for the successful resolution negotiations.

North Korea’s ambassador, Han Tae Song, told the U.N.-sponsored Conference on Disarmament in Geneva on Tuesday the United States was “fired up for political, economic, and military confrontation”.

The North regularly threatens to destroy the South and its main ally, the United States, which it accuses of continual preparation for invasion.

“My delegation condemns in the strongest terms, and categorically rejects, the latest illegal and unlawful U.N. Security Council resolution,” he said.

The Democratic People’s Republic of Korea (DPRK) was “ready to use a form of ultimate means”, Han said, without elaborating.

“The forthcoming measures by DPRK will make the U.S. suffer the greatest pain it ever experienced in its history.”

U.S. disarmament ambassador Robert Wood took the floor to say the Security Council resolution “frankly sent a very clear and unambiguous message to the regime that the international community is tired, is no longer willing to put up with provocative behavior from this regime”.

U.N. member states are now required to halt imports of textiles from North Korea, its second largest export after coal and other minerals in 2016 that totaled $752 million and accounted for a quarter of its income from trade, according to South Korean data. Nearly 80 percent went to China.

“This resolution also puts an end to the regime making money from the 93,000 North Korean citizens it sends overseas to work and heavily taxes,” Haley said.

“This ban will eventually starve the regime of an additional $500 million or more in annual revenues,” she said.

RESUME DIALOGUE

South Korea’s presidential Blue House said the only way for Pyongyang to end diplomatic isolation and free itself of economic pressure was to end its nuclear program and resume dialogue.

“North Korea needs to realize that a reckless challenge against international peace will only bring about even stronger international sanctions against it,” the Blue House said.

However, China’s official Xinhua news agency said in a commentary that the Trump administration was making a mistake by rejecting diplomatic engagement with the North.

“The U.S. needs to switch from isolation to communication in order to end an ‘endless loop’ on the Korean peninsula, where “nuclear and missile tests trigger tougher sanctions and tougher sanctions invite further tests,” Xinhua said.

Japanese Prime Minister Shinzo Abe quickly welcomed the resolution and said after the vote it was important to change North Korea’s policy by stepping up pressure.

The resolution imposes a ban on condensates and natural gas liquids, a cap of 2 million barrels a year on refined petroleum products, and a cap on crude oil exports to North Korea at current levels. China supplies most of North Korea’s crude.

A U.S. official, familiar with the council negotiations and speaking on condition of anonymity, said North Korea imported about 4.5 million barrels of refined petroleum products annually and 4 million barrels of crude oil.

Chinese officials have privately expressed fears that an oil embargo could risk causing massive instability in their neighbor. Russia and China have also expressed concern about the humanitarian impact of stiffer sanctions on North Korea.

Haley said the resolution aimed to hit “North Korea’s ability to fuel and fund its weapons program”. Trump has vowed not to allow North Korea to develop a nuclear missile capable of hitting the mainland United States.

South Korean officials said after the North’s sixth nuclear test that Pyongyang could soon launch another intercontinental ballistic missile in defiance of international pressure. North Korea said its Sept. 3 test was of an advanced hydrogen bomb and was its most powerful by far.

The latest resolution contained new political language urging “further work to reduce tensions, so as to advance the prospects for a comprehensive settlement”.

The resolution also calls on countries to inspect vessels on the high seas, with the consent of the flag state, if they have reasonable grounds to believe the ships are carrying prohibited cargo.

It also bans joint ventures with North Korean entities, except for non-profit public utility infrastructure projects.

(Additional reporting by Hyonhee Shin and Christine Kim in Seoul, Philip Wen in Beijing, Kaori Kaneko in Tokyo, David Brunnstrom in Washington and Stephanie Nebehay in Geneva; Editing by Nick Macfie)

U.N. Security Council to vote Monday on weakened North Korea sanctions

North Korean leader Kim Jong Un claps during a celebration for nuclear scientists and engineers who contributed to a hydrogen bomb test, in this undated photo released by North Korea's Korean Central News Agency (KCNA) in Pyongyang on September 10, 2017.

By Michelle Nichols and Jack Kim

UNITED NATIONS/SEOUL (Reuters) – The U.N. Security Council is set to vote on Monday on a watered-down U.S.-drafted resolution to impose new sanctions on North Korea over its latest nuclear test, diplomats said, but it was unclear whether China and Russia would support it.

North Korea warned the United States that it would pay a “due price” for spearheading efforts for fresh sanctions for this month’s nuclear test, which followed a series of test missile launches, all in defiance of U.N. sanctions.

A U.S.-drafted resolution originally calling for an oil embargo on the North, a halt to its key exports of textiles and subjecting leader Kim Jong Un to a financial and travel ban have been weakened, apparently to placate Russia and China which both have veto powers, diplomats said.

It no longer proposes blacklisting Kim and relaxes sanctions earlier proposed on oil and gas, a draft reviewed by Reuters shows. It still proposes a ban on textile exports.

North Korea was condemned globally for conducting its sixth nuclear test on Sept 3, which it said was of an advanced hydrogen bomb. NATO head Jens Stoltenberg said at the weekend that North Korea’s “reckless behavior”, pursuing nuclear and missile programs, was a global threat and required a global response.

The tensions have weighed on global markets, but on Monday there was some relief among investors that North Korea did not conduct a further missile test this weekend when it celebrated its founding anniversary.

Still, North Korea denounced efforts by Washington to impose new U.N.-backed sanctions against the country. The North’s Foreign Ministry spokesman said the United States was “going frantic” to manipulate the Security Council over Pyongyang’s nuclear test, which it said was part of “legitimate self-defensive measures.”

“In case the U.S. eventually does rig up the illegal and unlawful ‘resolution’ on harsher sanctions, the DPRK shall make absolutely sure that the U.S. pays due price,” the spokesman said in a statement carried by the official KCNA news agency.

DPRK stands for the North’s formal name, the Democratic People’s Republic of Korea.

“The world will witness how the DPRK tames the U.S. gangsters by taking a series of actions tougher than they have ever envisaged,” the unnamed spokesman said.

“The DPRK has developed and perfected the super-powerful thermo-nuclear weapon as a means to deter the ever-increasing hostile moves and nuclear threat of the U.S. and defuse the danger of nuclear war looming over the Korean peninsula and the region.”

South Korean President Moon Jae-in said last week during a visit to Russia that shutting off North Korea’s supply of oil was inevitable this time to bring Pyongyang to talks and he called for Russian President Vladimir Putin’s support.

Putin has remained firm however that such sanctions on oil would have negative humanitarian effects on North Koreans.

China, the North’s lone major ally, may be most critical though in deciding if oil sanctions go ahead because it controls an oil pipeline that industry sources say provides about 520,000 tonnes of crude a year to the North.

A Security Council resolution needs nine votes in favor and no vetoes by permanent members the United States, Britain, France, Russia or China to pass.

Chinese Foreign Ministry spokesman Geng Shuang stressed the need for consensus and maintaining peace.

“I have said before that China agrees that the U.N. Security Council should make a further response and necessary actions with respect to North Korea’s sixth nuclear test,” he told reporters.

“We hope Security Council members on the basis of sufficient consultations reach consensus and project a united voice. The response and actions the Security Council makes should be conducive to the denuclearization of the peninsula, conducive to safeguarding the peace and stability of the peninsula, and conducive to push forward the use of peaceful and political means to resolve the peninsula nuclear issue.”

 

FALLOUT

The latest draft of the resolution reflects the challenge in imposing tough sanctions on the North by curbing its energy supply and singling out its leader for a financial and travel ban, a symbolic measure at best but one that is certain to rile Pyongyang.

It will also be a disappointment to South Korea, which has sought tough new sanctions that would be harder for Pyongyang to ignore, as it said dialogue remained on the table.

“We have been in consultations that oil has to be part of the final sanctions,” South Korean Foreign Minister Kang Kyung-wha told a news conference, saying Pyongyang was on a “reckless path”.

“I do believe that whatever makes it into the final text and is adopted by consensus hopefully will have significant consequences on the economic pressure against North Korea.”

There was no independent verification of the North’s claim to have conducted a hydrogen bomb test, but some experts said there was enough strong evidence to suggest Pyongyang had either developed a hydrogen bomb or was getting close.

KCNA said on Sunday that Kim threw a banquet to celebrate the scientists and top military and party officials who contributed to the nuclear bomb test, topped with an art performance and a photo session with the leader himself.

The standoff is also spilling over into the business relationship between South Korea and China.

South Korea’s Lotte Shopping  is considering selling its supermarkets in China and other options should political tensions between Seoul and Beijing continue next year, an official at the retailer told Reuters.

China has pressured South Korean businesses via boycotts and bans since Seoul decided last year to deploy a U.S.-made missile defense system as a deterrent to North Korea. Beijing says the system’s radar can penetrate far into its territory.

South Korea deployed four additional units of the Terminal High Altitude Area Defense (THAAD) system on Thursday after the North’s latest nuclear test.

The heightened tension could have a substantial impact on South Korea’s economy and could also disrupt trade between the United States and China, ratings agency Fitch said on Monday.

Outright military conflict on the Korean peninsula is unlikely but prolonged tension could undermine business and consumer sentiment, Fitch said.

 

(Additional reporting by Christine Kim and Hyunjoo Jin in SEOUL and Philip Wen in BEIJING; Editing by Neil Fullick and Nick Macfie)