Tag Archives: North Korea

World stocks reach new peak in world full of surprises

Traders work in front of the German share price index, DAX board, at the stock exchange in Frankfurt, Germany, August 4, 2017.

By John Geddie

LONDON (Reuters) – World stocks breached record highs on Monday as better-than-expected company earnings and economic data from the United States stole the focus from rising geopolitical tension over North Korea’s nuclear program.

The U.S. dollar  dipped slightly but held on to most of Friday’s gains – its biggest daily rise this year – made after data showed the United States created more jobs than forecast last month.

For those watching second quarter corporate results in recent weeks, there have been many such surprises. Of the nearly 1000 companies in the MSCI world index that have reported, 67 percent have beaten expectations, according to Reuters data.

These two factors helped nudge the flagship share index above a peak breached late last month, setting a new all-time high of 480.09 on Monday.

The Dow Jones, which recorded its eighth consecutive record high on Friday, was set to open up slightly on Monday.

“Global equities remain the preferred asset class for investors and this can be clearly seen in the new highs hit by world indices today,” said Edward Park, investment director at Brooks Macdonald.

“Whilst the headline beat in non-farm payrolls was the primary positive for the market … equity prices are supported by a strong earnings season and relatively low event risk over the next few months.”

Aside from a slight weakening in the Korean won, there was little financial market reaction to the news over the weekend that the U.N. Security Council unanimously imposed new sanctions on North Korea aimed at pressuring Pyongyang to end its nuclear program.

South Korean President Moon Jae-in and his U.S. counterpart, Donald Trump, agreed in a telephone call on Monday to apply maximum pressure and sanctions on North Korea, while China expressed hope that North and South Korea could resume contact soon.

Yields on U.S. and German government bonds – seen as a safe haven in times of stress – held above one-month lows hit at the tail end of last week.

 

ASIAN GAINS

A strong rise in U.S. and Asian stocks propelled the world index to a new high, with the strength of the euro providing a bit of a headache for European markets.

Earlier in Asian trading, MSCI’s broadest index of Asia-Pacific shares outside Japan added 0.5 percent while Japan’s Nikkei added 0.5 percent.

Chinese blue chips were bolstered by data showing the country’s foreign exchange reserves rose twice as much as expected in July.

A dramatic reduction in capital outflows – which are seen as one of China’s biggest risks – has helped boost confidence in the world’s second largest economy ahead of a key political leadership reshuffle in coming months.

The euro zone’s main stock index edged lower, however, as the single currency headed back towards 20-month high, a trend which appears to be denting profitability in certain sectors.

Of the MSCI Europe companies having reported, 61 percent have either met or beat expectations. But focusing on industrial firms – of which many depend on exports, and are sensitive to a stronger euro – the beat ratio is just 37 percent.

“The euro is likely to have an impact in the third quarter, with a 10 percent appreciation of the euro lowering earnings per share by around 5 percent,” said Valentin Bissat, senior strategist at Mirabaud Asset Management.

DOLLAR DOUBTS

The upbeat U.S. jobs data offers policymakers some assurance that inflation will gradually rise to the central bank’s 2 percent target, and likely clear the way for a plan to start shrinking its massive bond portfolio later this year.

But market pricing shows investors are still about evenly divided over whether the Fed will also opt to raise rates again in December.

For some analysts, Monday’s pull back in the dollar backs some views in markets that Friday’s rally may not have legs.

The dollar index, which tracks the greenback against a basket of six global peers, inched back 0.2 percent to 93.361. It rallied 0.76 percent on Friday, its biggest one-day gain this year.

The dollar slipped 0.2 percent against the euro to $1.1796 per euro, after surging 0.8 percent on Friday.

“The most logical view here is the moves on Friday were clearly just a sizeable covering of USD shorts, from what was one of the biggest net short positions held against the USD for many years,” Chris Weston, chief market strategist at IG in Melbourne, wrote in a note.

For the dollar rally to gain momentum, the market needs to change its interest rate pricing, Weston added.

In commodities, oil prices slid back from nine-week highs hit on Aug. 4 as worries lingered over high production from OPEC and the United States.

Global benchmark Brent crude futures were down 60 cents, or 1.14 percent, at $51.82 a barrel. They traded as low as $51.56 a barrel earlier in the day.

Gold  steadied as the dollar surrendered some of its gains, but remained under pressure. The precious metal was marginally lower at $1,257.41 an ounce, extending Friday’s 0.8 percent loss.

 

(Reporting by John Geddie in London and Nichola Saminather in Singapore Additional reporting by Helen Reid in London; Editing by Richard Balmforth)

 

North Korea ready to teach U.S. ‘severe lesson’, says U.N. abused its authority

North Korean Foreign Minister Ri Yong-ho (C) walks toward an escalator during ongoing meetings at the Philippine International Convention Center

MANILA (Reuters) – North Korea is ready to give the United States a “severe lesson” with its strategic nuclear force if it takes military action against it, and will not put its nuclear program or its missiles on the negotiating table, it said in a statement to a regional meeting on Monday.

In a transcript of a statement by Foreign Minister Ri Yong-ho, which was distributed to media in Manila, Pyongyang called new U.N. sanctions “fabricated” and warned there would be “strong follow-up measures” and acts of justice. It said the resolution showed the United Nations had abused its authority.

It said its intercontinental ballistic missile tests in July proved that the entire United States was in its firing range, and those missiles were a legitimate means of self-defense.

It was not immediately clear whether the statement was read to the ASEAN Regional Forum on Monday.

 

 

(Reporting by Neil Jerome Morales and Manolo Serapio Jr; Writing by Martin Petty; Editing by Nick Macfie)

 

U.S. may soon expand U.N. talks on North Korea sanctions, signaling China deal: diplomats

U.S. may soon expand U.N. talks on North Korea sanctions, signaling China deal: diplomats

By Michelle Nichols

UNITED NATIONS (Reuters) – The United States could shortly broaden talks on a push for stronger U.N. sanctions on North Korea to include all 15 Security Council members, signaling a likely deal with China on new measures, diplomats said on Thursday.

Since North Korea’s July 4 launch of an intercontinental ballistic missile (ICBM), the United States has been negotiating with Pyongyang ally China on a draft resolution to impose new sanctions on North Korea, which fired a second ICBM last Friday, in defiance of U.N. Security Council resolutions.

“We have been working very hard for some time and we certainly hope that this is going to be a consensus resolution,” China’s U.N. Ambassador Liu Jieyi told Reuters on Thursday.

Some diplomats said the United States could give the draft resolution to all 15 council members as early as Thursday.

Typically, the United States and China have agreed sanctions on North Korea before formally involving other council members. A resolution needs nine votes in favor and no vetoes by the United States, China, Russia, France or Britain to be adopted.

The United States has been informally keeping Britain and France in the loop on the negotiations, while U.S. Ambassador to the United Nations Nikki Haley said China had been sharing the draft and negotiating with Russia.

U.S. President Donald Trump’s administration has been frustrated that China has not done more to rein in North Korea and Washington has threatened to impose new sanctions on Chinese firms doing business with Pyongyang.

But Chinese Foreign Minister Wang Yi told his British counterpart, Boris Johnson, on Friday that China would continue to fully and strictly implement Security Council resolutions on North Korea, the ministry said.

Haley said on Sunday the United States was “done talking about North Korea” and China must decide if it is willing to back imposing stronger U.N. sanctions. But she has also acknowledged that Russia’s engagement on the draft resolution would be the “true test.”

Russia noted on Thursday that the permanent five (P5) veto powers had yet to formally discuss the draft. It was not immediately clear if poor relations between Russia and the United States, which imposed new unilateral sanctions on Russia on Wednesday, would hamper the negotiations.

“Even if there is an agreement between the U.S. and China, it doesn’t mean there is an agreement between the P5 members,” said Russia’s U.N. Ambassador Vassily Nebenzia, who met with Liu earlier on Thursday and discussed a possible resolution.

“Maybe there is a bilateral agreement (between Beijing and Washington), but that’s not a universal one,” he said, adding that while he was aware of what might be in the resolution he had not seen “the draft as it stands now.”

The U.S. mission to the United Nations declined to comment.

Moscow has disagreed with assessments by Western powers that Pyongyang has launched two long-range missiles, saying they were mid-range. Diplomats say China and Russia only view a test of a long-range missile or a nuclear weapon as a trigger for further possible U.N. sanctions.

North Korea has been under U.N. sanctions since 2006 over its ballistic missile and nuclear programs and the Security Council has ratcheted up the measures in response to five nuclear weapons tests and two long-range missile launches.

(Reporting by Michelle Nichols; Additional reporting by Ben Blanchard in BEIJING; Editing by James Dalgleish)

U.S. bans travel to North Korea from September 1, says Americans should leave

FILE PHOTO: People carry flags in front of statues of North Korea founder Kim Il Sung (L) and late leader Kim Jong Il during a military parade marking the 105th birth anniversary Kim Il Sung, in Pyongyang April 15, 2017. REUTERS/Damir Sagolj

By Yeganeh Torbati

WASHINGTON (Reuters) – A ban on travel by U.S. passport holders to North Korea will take effect on Sept. 1 and Americans in the country should leave before that date, the U.S. State Department said on Wednesday.

Journalists and humanitarian workers may apply for exceptions to the ban, the department said in a public notice.

The U.S. government last month said it would bar Americans from traveling to North Korea due to the risk of “long-term detention” there.

The ban comes at a time of heightened tensions between the United States and North Korea, which has been working to develop a nuclear-tipped missile capable of hitting the United States.

North Korea will become the only country to which Americans are banned from traveling.

American student Otto Warmbier, sentenced last year to 15 years’ hard labor in North Korea, returned to the United States in a coma on June 13 after being released on humanitarian grounds, and died June 19. The circumstances surrounding his death are not clear, including why he fell into a coma.

North Korea has said through its state media that Warmbier’s death was “a mystery” and dismissed accusations that he had died as a result of torture and beating in captivity.

The State Department issued a notice in the Federal Register on Wednesday declaring U.S. passports invalid for travel to, in or through North Korea. The restriction takes effect in 30 days, and applies for one year unless extended or revoked by the secretary of state.

“Persons currently in North Korea on a U.S. passport should depart North Korea before the travel restriction enters into effect on Friday, September 1, 2017,” the department said in a statement.

Professional reporters or journalists, representatives of the International Committee of the Red Cross or the American Red Cross traveling on official missions, those traveling to North Korea for “compelling humanitarian considerations” and those whose requests are “in the national interest” may ask for a special validation of their passports in order to travel to the country, the State Department said.

North Korea is currently holding two Korean-American academics and a missionary, a Canadian pastor and three South Korean nationals who were doing missionary work. Japan says North Korea has also detained at least several dozen of its nationals.

(Reporting by Yeganeh Torbati, David Brunnstrom and David Alexander; Editing by Jonathan Oatis and James Dalgleish)

China welcomes U.S. seeking dialogue with North Korea

China welcomes U.S. seeking dialogue with North Korea

By Michael Martina

BEIJING (Reuters) – China on Thursday welcomed comments by Secretary of State Rex Tillerson that the United States does not seek to topple the North Korean government and would like dialogue with Pyongyang at some point, saying China had always supported talks.

Tillerson reiterated that Washington sought to persuade North Korea to give up its missile and nuclear weapons programs through peaceful pressure.

The United States does not seek regime change, the collapse of the regime, an accelerated reunification of the peninsula or an excuse to send the U.S. military into North Korea, Tillerson said.

Speaking to reporters, Chinese Foreign Minister Wang Yi said China “attached great importance” to Tillerson’s remarks and his reiteration of what Wang called the “Four Nos” principle.

“We hope the U.S. side can put this ‘Four Nos’ principle into actual policy towards North Korea,” Wang said.

The United States has recently been paying more attention to security issues on the Korean peninsula, and China has always believed security is the key to resolving the problem, he added.

North Korea says it needs a strong military deterrent to prevent a hostile United States from attacking it.

China hopes all sides can meet each other halfway and through talks find a way of resolving each others security concerns as this is the key for a resolution, Wang said.

In a separate statement sent to Reuters regarding Tillerson’s remarks, the foreign ministry said it had always supported dialogue between the United States and North Korea.

On Saturday, Pyongyang said it had conducted another successful test of an intercontinental ballistic missile that proved its ability to strike the United States.

Tillerson, who will also attend the ASEAN Regional Forum in Manila, is expected to press China and other regional nations to take tougher action against North Korea.

China has signed up for increasingly tough United Nations sanctions against North Korea, but has also pushed for a resumption of dialogue and de-escalation by both Pyongyang and Washington.

Tillerson’s remarks showed “courage”, said the state-run Global Times newspaper, which is usually known for its nationalistic bent.

“Many Americans would think Tillerson is showing weakness, but we see his statement as the most courageous expression from Washington regarding the Korean peninsula issue,” it said in an editorial on Thursday.

“While (Washington) exerts pressure on North Korea, it should leave some alternatives for Pyongyang and make it believe that abandoning its nuclear and missile programs will do more good than insisting on this path.”

Wang also urged all parties not to heighten tension on the Korean peninsula and said China had already clearly condemned North Korea’s latest missile test.

“Regarding North Korea’s recent missile launch, once again in violation of UN Security Council resolutions, China has already clearly expressed our opposition,” Wang said.

“At the same time, we also call on all parties not to take any actions that will lead to an escalation in tensions.”

(Writing by Philip Wen and Ben Blanchard; Editing by Paul Tait and Clarence Fernandez)

Top Senate Democrat urges Trump to block China deals over North Korea

Senate Minority Leader Chuck Schumer, accompanied by Senator Patty Murray (D-WA) and Senator Debbie Stabenow (D-MI), speaks with reporters following the successful vote to open debate on a health care bill on Capitol Hill in Washington, U.S., July 25, 2017. REUTERS/Aaron P. Bernstein

WASHINGTON (Reuters) – The top Democrat in the U.S. Senate called on President Donald Trump on Tuesday to block some Chinese investments in the United States to pressure China “to help rein in North Korea’s threatening and destabilizing behavior.”

In a letter to Trump, Senate Democratic leader Chuck Schumer urged him to use his authority through the Committee on Foreign Investment in the United States, or CFIUS, to pressure Beijing by suspending approval of “all mergers and acquisitions in the U.S. by Chinese entities.”

Schumer’s request comes amid concern about North Korea, which fired a missile Friday that experts said was capable of hitting Los Angeles. Trump has repeatedly urged China to rein in its ally North Korea, and Schumer agreed.

“It is my assessment that China will not deter North Korea unless the United States exacts greater economic pressure on China,” Schumer wrote to Trump, a Republican. “The U.S. must send a clear message to China’s government.”

Senator John Cornyn, a Republican on the Senate Intelligence Committee, was unconvinced that CFIUS was the right tool.

“That’s not specifically the purpose of CFIUS. CFIUS is a national security vehicle to try to make sure that high-tech investments by foreign countries don’t steal our cutting-edge technology,” Cornyn said outside his Senate office.

“I’m happy to work with Senator Schumer to figure out what his concerns are,” added Cornyn, who has urged changes at CFIUS because of China. His worry, however, was not North Korea but that China would close the technology gap between the U.S. and Chinese militaries.

Led by the U.S. Department of Treasury, CFIUS reviews foreign acquisitions of U.S. companies on national security grounds and can take action on its own or refer cases to the president.

In an interview with Reuters Friday, the top U.S. counter-intelligence official suggested the Trump administration was already working on a plan to toughen CFIUS.

“We’re making significant progress on that, working with both sides of Pennsylvania Avenue,” said William Evanina, National Counterintelligence Executive, referring to the White House and Congress. “I think it’s going to look a lot different than it does now.”

Evanina, whose office oversees U.S. government efforts to counter spying and industrial espionage, declined to be more specific but noted that China’s direct investment in the United States quadrupled from 2015 to 2016, to $48 billion annually.

China’s UN ambassador, on the other hand, has said that it was up to Washington and Pyongyang to work toward talks on North Korea’s weapons programs.

“(The United States and North Korea) hold the primary responsibility to keep things moving, to start moving in the right direction, not China,” China’s U.N. Ambassador Liu Jieyi told reporters on Monday. “No matter how capable China is, China’s efforts will not yield practical results.”

While China worries about North Korea’s nuclear and missile programs, and the U.S. reaction to them, its overriding concern, U.S. officials say, is to avoid a North Korean collapse, which could send millions of refugees fleeing toward China and lead to a reunified Korea allied with Washington.

Schumer’s plan to prohibit CFIUS from approving Chinese deals would be technically legal but would stretch CFIUS’ mandate, CFIUS experts said.

“What sounds like effectively a bar on Chinese investment that is being suggested is probably legal but quite different than the case-by-case process that CFIUS has used in the past,” said Stephen Heifetz of the law firm Steptoe & Johnson LLP who represents clients before CFIUS. “The U.S. government should consider the potential for a Chinese response.”

The task force this year faces what could well be a record number of deals, many of them controversial as Chinese firms scout U.S. targets as varied as hotels and film studios to hedge against a weaker yuan <CNY=>.

(Additional reporting by Diane Bartz, Susan Cornwell and Warren Strobel; Writing by Susan Heavey; Editing by Bill Trott and James Dalgleish)

Philippines’ Duterte calls North Korea’s Kim a ‘fool’ over nuclear ambitions

Philippine President Rodrigo Duterte speaks to protesters after he delivered his State of the Nation address at the Congress in Quezon city, Metro Manila Philippines July 24, 2017. REUTERS/Erik De Castro

MANILA (Reuters) – Philippine President Rodrigo Duterte on Wednesday described North Korean leader Kim Jong Un as a “fool” and a “son of a b****”, just days before Manila hosts an international meeting certain to address Pyongyang’s long-range missile tests.

Duterte held nothing back in rebuking Kim for “playing with dangerous toys”, setting the stage for next week’s rare get-together, to be attended by foreign ministers of all the countries involved in the standoff on the Korean peninsula.

North Korea is determined to develop a nuclear-tipped missile capable of hitting the United States and officials in Washington said Saturday’s test of an intercontinental ballistic missile showed it may be able to reach most of the country.

“This Kim Jong Un, a fool … he is playing with dangerous toys, that fool,” Duterte told tax officials in a speech.

“That chubby face that looks kind. That son of a bitch. If he commits a mistake, the Far East will become an arid land. It must be stopped, this nuclear war.

“A limited confrontation and it blows up here, I will tell you, the fallout can deplete the soil, the resources and I don’t know what will happen to us.”

This year, Duterte is chairman of the Association of South East Asian Nations (ASEAN) and on Monday his foreign minister will host the ASEAN Regional Forum, which brings together 27 countries that include Australia, China, India, Japan, Russia, North and South Korea and the United States.

It was not the first time Duterte has criticized Kim over his nuclear ambitions. In April he questioned his sanity and urged the United States to show restraint and not be baited by a man who “wants to end the world”.

U.S. Secretary of State Rex Tillerson, who is due to attend the Manila meeting, on Tuesday said he wanted dialogue with North Korea at some point, stressing it was not the enemy and the United States did not seek to topple the regime.

(Reporting by Martin Petty and Neil Jerome Morales; Editing by Clarence Fernandez)

China hits back at Trump criticism over North Korea

Soldiers carry a PLA flag and Chinese national flags before the military parade to commemorate the 90th anniversary of the foundation of China's People's Liberation Army (PLA) at Zhurihe military base in Inner Mongolia Autonomous Region, China, July 30, 2017. REUTERS/Stringer

By Ben Blanchard and Elias Glenn

BEIJING (Reuters) – China hit back on Monday after U.S. President Donald Trump tweeted he was “very disappointed” in China following North Korea’s latest missile test, saying the problem did not arise in China and that all sides need to work for a solution.

China has become increasingly frustrated with American and Japanese criticism that it should do more to rein in Pyongyang. China is North Korea’s closest ally, but Beijing, too, is angry with its continued nuclear and missile tests.

North Korea said on Saturday it had conducted another successful test of an intercontinental ballistic missile that proved its ability to strike the U.S. mainland, drawing a sharp warning from Trump and a rebuke from China.

Video of the latest missile test appears to show it breaking up before landing, indicating Pyongyang may not yet have mastered re-entry technology needed for an operational nuclear-tipped missile, a think tank reported on Monday.

Japanese Prime Minister Shinzo Abe spoke with Trump on Monday and agreed on the need for more action on North Korea just hours after the U.S. Ambassador to the United Nations said Washington is “done talking about North Korea”.

A White House statement after the phone call said the two leaders “agreed that North Korea poses a grave and growing direct threat to the United States, Japan, the Republic of Korea, and other countries near and far”.

It said Trump “reaffirmed our ironclad commitment” to defend Japan and South Korea from any attack, “using the full range of United States capabilities”.

Trump tweeted on Saturday after the missile test that he was “very disappointed” in China and that Beijing profits from U.S. trade but had done “nothing” for the United States with regards to North Korea, something he would not allow to continue.

Asked by a reporter on Monday how he plans to deal with Pyongyang, Trump said at the start of a Cabinet meeting: “We’ll handle North Korea… It will be handled.”

China’s Foreign Ministry, in a statement sent to Reuters responding to Trump’s earlier tweets, said the North Korean nuclear issue did not arise because of China and that everyone needed to work together to seek a resolution.

Russia said on Monday the United States and other countries were trying “to shift responsibility for the situation to Russia and China” following the most recent missile test.

“We view as groundless attempts undertaken by the U.S. and a number of other countries to shift responsibility to Russia and China, almost blaming Moscow and Beijing for indulging the missile and nuclear ambitions of the DPRK (North Korea),” the Russian Foreign Ministry said in a statement.

At the United Nations in New York, China’s U.N. ambassador said on Monday it is primarily up to the United States and North Korea, not Beijing, to reduce tensions and work toward resuming talks to end Pyongyang’s nuclear weapon and missile programs.

The United States and North Korea “hold the primary responsibility to keep things moving, to start moving in the right direction, not China,” China’s U.N. Ambassador Liu Jieyi told a news conference to mark the end of Beijing’s presidency of the U.N. Security Council in July.

“No matter how capable China is, China’s efforts will not yield practical results because it depends on the two principal parties,” Liu said.

Chinese Vice Commerce Minister Qian Keming told a news conference there was no link between the North Korea issue and China-U.S. trade.

“We think the North Korea nuclear issue and China-U.S. trade are issues that are in two completely different domains. They aren’t related. They should not be discussed together,” Qian said.

China, with which North Korea does most of its trade, has repeatedly said it strictly follows U.N. resolutions on North Korea and has denounced unilateral U.S. sanctions as unhelpful.

Nikki Haley, U.S. Ambassador to the United Nations, said in a statement China must decide if it is willing to back imposing stronger U.N. sanctions on North Korea over Friday night’s long-range missile test, the North’s second this month.

Any new U.N. Security Council resolution “that does not significantly increase the international pressure on North Korea is of no value”, Haley said, adding that Japan and South Korea also needed to do more.

Abe told reporters after his conversation with Trump that repeated efforts by the international community to find a peaceful solution to the North Korean issue had yet to bear fruit in the face of Pyongyang’s unilateral “escalation”.

“International society, including Russia and China, need to take this seriously and increase pressure,” Abe said. He added Japan and the United States would take steps towards concrete action but did not give details.

Abe and Trump did not discuss military action against North Korea, nor what would constitute the crossing of a “red line” by Pyongyang, Deputy Chief Cabinet spokesman Koichi Hagiuda told reporters.

“Pyongyang is determined to develop its nuclear and missile program and does not care about military threats from the U.S. and South Korea,” state-run Chinese tabloid the Global Times said on Monday.

“How could Chinese sanctions change the situation?” said the paper, which is published by the ruling Communist Party’s official People’s Daily.

China wants both balanced trade with the United States and lasting peace on the Korean peninsula, its official Xinhua news agency added in a commentary.

“However, to realize these goals, Beijing needs a more cooperative partner in the White House, not one who piles blame on China for the United States’ failures,” it added.

The United States flew two supersonic B-1B bombers over the Korean peninsula in a show of force on Sunday in response to the missile test and the July 3 launch of the “Hwasong-14” rocket, the Pentagon said. The bombers took off from a U.S. air base in Guam and were joined by Japanese and South Korean fighter jets during the exercise.

“North Korea remains the most urgent threat to regional stability,” Pacific Air Forces commander General Terrence J. O’Shaughnessy said in a statement.

“If called upon, we are ready to respond with rapid, lethal, and overwhelming force at a time and place of our choosing.”

(Additional reporting by Chang-ran Kim in Tokyo, Christine Kim in Seoul, Michelle Nichols and Riham Alkousaa at the United Nations, Polina Devitt in Moscow and Steve Holland in Washington; Editing by Michael Perry and James Dalgleish)

China hits back at Trump criticism over North Korea

Intercontinental ballistic missile (ICBM) Hwasong-14 is pictured during its second test-fire in this undated picture provided by KCNA in Pyongyang

By Ben Blanchard and Elias Glenn

BEIJING (Reuters) – China hit back on Monday after U.S. President Donald Trump tweeted he was “very disappointed” in China following Pyongyang’s latest missile test, saying the problem did not arise in China and that all sides need to work for a solution.

China has become increasingly frustrated with American and Japanese criticism that it should do more to rein in Pyongyang. China is North Korea’s closest ally, but Beijing is angry with its continued nuclear and missile tests.

North Korea said on Saturday it had conducted another successful test of an intercontinental ballistic missile that proved its ability to strike the U.S. mainland, drawing a sharp warning from Trump and a rebuke from China.

Japanese Prime Minister Shinzo Abe spoke with Trump on Monday and agreed on the need for more action on North Korea just hours after the U.S. Ambassador to the United Nations said Washington is “done talking about North Korea”.

A White House statement after the phone call said the two leaders “agreed that North Korea poses a grave and growing direct threat to the United States, Japan, the Republic of Korea, and other countries near and far”.

It said Trump “reaffirmed our ironclad commitment” to defend Japan and South Korea from any attack, “using the full range of United States capabilities”.

Trump wrote on Twitter on Saturday after the missile test that he was “very disappointed” in China and that Beijing profits from U.S. trade but had done “nothing” for the United States with regards to North Korea, something he would not allow to continue.

China’s Foreign Ministry, in a statement sent to Reuters responding to Trump’s tweets, said the North Korean nuclear issue did not arise because of China and that everyone needed to work together to seek a resolution.

“All parties should have a correct understanding of this,” it said, adding the international community widely recognized China’s efforts to seek a resolution.

The essence of Sino-U.S. trade is mutual benefit and win-win, with a vast amount of facts proving the healthy development of business and trade ties is good for both countries, the ministry added.

Chinese Vice Commerce Minister Qian Keming, weighed in too, telling a news conference there was no link between the North Korea issue and China-U.S. trade.

“We think the North Korea nuclear issue and China-US trade are issues that are in two completely different domains. They aren’t related. They should not be discussed together,” Qian said.

China, with which North Korea does the large majority of its trade, has repeatedly said it strictly follows U.N. resolutions on North Korea and has denounced unilateral U.S. sanctions as unhelpful.

Nikki Haley, U.S. Ambassador to the United Nations, said in a statement China must decide if it is willing to back imposing stronger U.N. sanctions on North Korea over Friday night’s long-range missile test, the North’s second this month.

Any new U.N. Security Council resolution “that does not significantly increase the international pressure on North Korea is of no value”, Haley said, adding that Japan and South Korea also needed to do more.

Abe told reporters after his conversation with Trump that repeated efforts by the international community to find a peaceful solution to the North Korean issue had yet to bear fruit in the face of Pyongyang’s unilateral “escalation”.

“International society, including Russia and China, need to take this seriously and increase pressure,” Abe said. He said Japan and the United States would take steps towards concrete action but did not give details.

Abe and Trump did not discuss military action against North Korea, nor what would constitute the crossing of a “red line” by Pyongyang, Deputy Chief Cabinet spokesman Koichi Hagiuda told reporters.

“Pyongyang is determined to develop its nuclear and missile program and does not care about military threats from the U.S. and South Korea,” state-run Chinese tabloid the Global Times said on Monday.

“How could Chinese sanctions change the situation?” said the paper, which is published by the ruling Communist Party’s official People’s Daily.

China wants both balanced trade with the United States and lasting peace on the Korean peninsula, its official Xinhua news agency added in a commentary.

“However, to realize these goals, Beijing needs a more cooperative partner in the White House, not one who piles blame on China for the United States’ failures,” it added.

The United States flew two supersonic B-1B bombers over the Korean peninsula in a show of force on Sunday in response to the missile test and the July 3 launch of the “Hwasong-14” rocket, the Pentagon said. The bombers took off from a U.S. air base in Guam and were joined by Japanese and South Korean fighter jets during the exercise.

“North Korea remains the most urgent threat to regional stability,” Pacific Air Forces commander General Terrence J. O’Shaughnessy said in a statement.

“If called upon, we are ready to respond with rapid, lethal, and overwhelming force at a time and place of our choosing.”

 

(Additional reporting by Chang-ran Kim in TOKYO, Ben Blanchard and Elias Glenn in BEIJING, Christine Kim in SEOUL and Steve Holland in WASHINGTON; Editing by Lincoln Feast, Paul Tait and Michael Perry)

 

U.S. flies bombers over Korean peninsula after North Korea missile test

One of two U.S. Air Force B-1B Lancer bombers flies a 10-hour mission from Andersen Air Force Base, Guam, into Japanese airspace and over the Korean Peninsula,

By James Pearson and Michelle Nichols

SEOUL/NEW YORK (Reuters) – The United States flew two supersonic B-1B bombers over the Korean peninsula in a show of force on Sunday and the U.S. ambassador to the United Nations said China, Japan and South Korea needed to do more after Pyongyang’s latest missile tests.

North Korea said it conducted another successful test of an intercontinental ballistic missiles (ICBM) on Friday that proved its ability to strike America’s mainland, drawing a sharp warning from U.S. President Donald Trump.

Trump’s ambassador to the United Nations Nikki Haley said on Twitter on Sunday that the United States was “done talking” about North Korea, which was “not only a U.S. problem.”

“China is aware they must act,” Haley said, urging Japan and South Korea to increase pressure and calling for an international solution.

China, the North’s main ally, said it opposed North Korea’s missile launches, which it said violate UN Security Council resolutions designed to curb Pyongyang’s banned nuclear and missile programs.

“At the same time, China hopes all parties act with caution, to prevent tensions from continuing to escalate,” China’s foreign ministry said in a statement on Saturday.

Early in his presidency, Trump met with Chinese President Xi Jinping and had expressed hope Beijing would use its economic clout to curb North Korea’s nuclear ambitions.

But on Saturday, Trump said on Twitter that he was “very disappointed in China” which he said profits from trade with the United States but does “NOTHING for us with North Korea, just talk. We will no longer allow this to continue,” he said.

 

DIRECT RESPONSE

North Korean leader Kim Jong Un personally supervised the midnight test launch of the missile on Friday night and said it was a “stern warning” for the United States that it would not be safe from destruction if it tries to attack, the North’s official KCNA news agency said.

North Korea’s state television broadcast pictures of the launch, showing the missile lifting off in a fiery blast in darkness and Kim cheering with military aides.

The missile test came a day after the U.S. Senate approved a package of sanctions against North Korea, Russia and Iran.

The B-1B flight was a response to the missile test and the July 3 launch of the “Hwasong-14” rocket, the Pentagon said. The bombers took off from a U.S. air base in Guam, and were joined by Japanese and South Korean fighter jets during the exercise, according to the statement.

“North Korea remains the most urgent threat to regional stability,” Pacific Air Forces commander General Terrence J. O’Shaughnessy said in a statement.

“If called upon, we are ready to respond with rapid, lethal, and overwhelming force at a time and place of our choosing.”

Also on Sunday, the U.S. Missile Defense Agency announced the United States had successfully shot down a medium-range missile in the latest test of its THAAD missile defense program which is designed to protect the country against potential threats from countries such as North Korea and Iran.

The test was planned well before the rising tensions with North Korea and involved a medium-range missile, not the long-range types being tested by the North Koreans.

 

FAR REACH

The Hwasong-14, named after the Korean word for Mars, reached an altitude of 3,724.9 km (2,314.6 miles) and flew 998 km (620 miles)for 47 minutes and 12 seconds before landing in the waters off the Korean peninsula’s east coast, KCNA said.

Western experts said calculations based on that flight data and estimates from the U.S., Japanese and South Korean militaries showed the missile could have been capable of going as far into the United States as Denver and Chicago.

David Wright of the U.S.-based Union of Concerned Scientists wrote in a blog post that if it had flown on a standard trajectory, the missile would have had a range of 10,400 km (6,500 miles).

U.S. Senator Dianne Feinstein, a leading Democrat on the Senate intelligence committee, said she saw the test as “a clear and present danger to the United States.”

“I think the only solution is a diplomatic one. I’m very disappointed in China’s response, that it has not been firmer or more helpful,” Feinstein told CBS television’s “Face the Nation,” urging the administration to begin talks with the North.

U.S. intelligence officials assess that even if North Korea does develop a reliable, nuclear-capable ICBM, which some say it remains several steps short of doing, the weapon would be almost useless except to deter the conventional attacks that Kim fears.

Intelligence experts have concluded that Kim will not abandon his pursuit of a deliverable nuclear weapon.

“Kim is determined to secure international recognition of the North as a nuclear armed state, for the purposes of security, prestige, and political legitimacy,” says the National Intelligence Council’s January Global Trends report.

 

(Additional reporting by Sarah N. Lynch, Susan Cornwell, John Walcott and Roberta Rampton in Washington; Editing by Sam Holmes and Phil Berlowitz)