North Korea’s development of nuclear weapons and long-range missiles poses a “direct threat” to the U.S. and its allies, a top U.S. military commander plans to tell Congress today amid rising tensions on the Korean peninsula.
The situation, fanned by hostile rhetoric from dictator Kim Jong Un, “creates an environment marked by the potential for miscalculation” and military escalation, Admiral Samuel Locklear, the head of the U.S. Pacific Command, said in prepared testimony for a Senate Armed Services Committee hearing.
Efforts by Kim’s regime to build and test nuclear weapons and ballistic missiles violate United Nations Security Council resolutions and “represent a clear and direct threat to U.S. national security and regional peace and stability,” Locklear said in his testimony.
North Korea’s threats to carry out pre-emptive nuclear strikes against the U.S. and South Korea have fueled a crisis atmosphere in the region and prompted calls for dialogue. South Korean shares fell for a seventh day today, and the won traded near its lowest level in eight months after the South Korean government said Kim’s regime may be ready to conduct a nuclear test or missile launch as early as this week.
Locklear’s remarks follow a prediction by the chairman of the U.S. House intelligence panel, Representative Mike Rogers, that North Korea is likely to carry out a small military attack to try to burnish Kim’s domestic image.
‘Small Skirmish’
“I do think there will be some small skirmish before this is over,” Rogers, a Michigan Republican, said in an interview yesterday at Bloomberg News headquarters in New York.
A military strike may be similar to previous flare-ups such as North Korea’s sinking of a South Korean ship in 2010 or a later artillery attack on the border island of Yeonpyeong, Rogers said.
North Korea is also ready to conduct a fourth underground atomic weapon test at its Punggye-ri site, after carrying out its third on Feb. 12, according to South Korean Defense Ministry spokesman Kim Min Seok. National security chief Kim Jang Soo said April 7 the North may stage a provocation including a ballistic missile test around April 10.
As tensions rose, North Korea said foreigners in South Korea could be in danger and should prepare for evacuation in case of war, the regime’s official Korean Central News Agency reported today. The announcement is “psychological warfare,” South Korean President Park Geun Hye’s spokeswoman, Kim Haing, said by phone.
Suspended Operations
The North also suspended operations indefinitely at a jointly run industrial complex. Employees didn’t show up for work at the Gaeseong park today, Unification Ministry spokesman Park Soo Jin said today.
South Korea sees no unusual North Korean troop movements near the complex, said a Defense Ministry official who declined to be named, citing ministry policy. Suspending work at the complex eliminates a source of hard currency for Kim Jong Un’s impoverished regime as well as the last link of exchange between the two countries.
Representatives of the South Korean companies at Gaeseong held an emergency meeting in Seoul today. The companies urged Park’s government to send a delegation to the North to discuss resuming work at the complex, said Han Jae Kwon, who heads the group of businesses.
Threats Intensified
While North Korea has intensified its threats, the U.S. and South Korea have said they’ve seen no unusual military movements suggesting preparations for war. North Korea is incapable of hitting the U.S. with a nuclear missile, and its chances of winning a second war with South Korea and the U.S. are poor, according to Joseph Bermudez, a military analyst who has studied North Korea’s strengths and weaknesses.
Japan has deployed PAC-3 missile interceptors including around Tokyo, Japan’s Chief Cabinet Secretary Yoshihide Suga told reporters today.
Locklear’s appearance today will be his first before the armed services panel since the crisis erupted last month. Citing the tensions, the U.S. commander in South Korea, General James Thurman, canceled his plans to testify this week.
Overseas investors have pulled some $1.9 billion from Korean stocks since the North conducted its third nuclear test on Feb. 12, helping drive the Kospi index down 1.5 percent and contributing to a 4 percent slide in the won. Still, the Kospi’s 3.8 percent drop this year is less than the 4.1 percent decline in the MSCI Emerging Markets Index and the won is only 1 percent weaker versus the dollar than its average level for the past three years.
Default Swaps
Five-year credit-default swaps used to insure South Korean government bonds against non-payment were little changed at 88 basis points yesterday. The swaps are at their highest level since Sept. 26, according to CMA prices in New York compiled by Bloomberg.
In Washington yesterday, Deputy Defense Secretary Ashton Carter said “the United States remains steadfast in its defense commitments” to South Korea, including extending the U.S nuclear umbrella to its ally.
“We are working with our friends and allies around the world to employ an integrated response” to North Korea’s “unacceptable provocations,” Carter said in a speech at the Center for Strategic and International Studies, a Washington policy group.
Trading Partner
American officials are looking to China, North Korea’s biggest trading partner, to use its economic and political clout to rein in Kim and prevent an armed conflict. U.S. Secretary of State John Kerry travels to Asia this week to meet leaders from South Korea, China and Japan.
Negotiations are “the only effective solution,” Chinese Foreign Ministry spokesman Hong Lei told reporters yesterday in Beijing, adding his government wants to see tensions ease.
“I do think that China could play, and I wish they would play, a larger role in influencing the North Koreans to stop the provocations,” Carter said. “China has more influence than any other country over North Korea.”