World

SEOUL — South Korea’s President Yoon Suk-yeol on Wednesday hailed growing cooperation with Japan on issues from North Korea to semiconductors, saying it was part of a historic “new chapter” for the two countries.

Yoon will travel to Tokyo on Thursday, his first visit since taking office last year, which follows his controversial move to try and finally settle a bitter historic dispute over Japanese World War II-era forced labour.

Yoon said he was confident his new plan to compensate victims would work, telling media including AFP in a written interview that “the Japanese government will join us in opening a new chapter of Korea-Japan relations”.

Yoon’s plan, unveiled this month, involves compensating Korean victims without Tokyo’s direct involvement, which has enraged some victims who say this falls far short of their demand for a full apology and direct compensation from the Japanese companies involved.

“Japan has expressed deep remorse and heartfelt apology in regard to its past colonial rule through the position of its previous governments,” Yoon said.

Around 780,000 Koreans were conscripted into forced labour by Japan during its colonial rule of the peninsula from 1905 to 1945, according to data from Seoul.

That number does not include Korean women forced into sexual slavery by Japanese troops.

Yoon is eager to lay the historic dispute to rest as he seeks closer ties with Tokyo — a key regional ally of Seoul’s security partner Washington — in the face of growing threats from North Korea.

‘Polycrisis’ 

Pyongyang last year declared itself an “irreversible nuclear state”, with leader Kim Jong-un at the start of 2023 calling for an “exponential” increase in weapons production — including tactical nukes.

South Korea will “never acknowledge North Korea as a nuclear state under any circumstances”, Yoon said in the interview on Wednesday.

He pointed to reports of people starving to death in North Korea — which has been under a strict self-imposed blockade since the start of the COVID pandemic in 2020.

“The North Korean regime could easily resolve its food shortages if it injected the money it spends on nuclear and missile development into improving its people’s livelihoods,” Yoon said.

Both South Korea and Japan are ramping up defence spending and joint military exercises, which Yoon said were essential for regional and global stability.

“There is an increasing need for Korea and Japan to cooperate in this time of a polycrisis with North Korean nuclear and missile threats escalating,” Yoon said.

“We cannot afford to waste time while leaving strained Korea-Japan relations unattended. I believe we must end the vicious cycle of mutual hostility and work together to seek our two countries’ common interests.”

Trade curbs 

But his moves to draw closer to Japan have been criticised as “insulting” to victims of forced labour by South Korean activists, and run contrary to some court rulings.

A landmark 2018 decision and other subsequent South Korean verdicts ordered companies including Mitsubishi Heavy Industries to pay compensation to Korean victims — a move that sent ties with Japan to their lowest in years.

Following the ruling, Japan in 2019 imposed export controls on key industrial materials needed by South Korea’s chip industry and removed the country from its “preferred trading nations” list. Seoul filed a complaint to the World Trade Organisation (WTO).

But both now appear to be moving to unwind tit-for-tat trade restrictions.

South Korea said this month it would halt its WTO complaint over Japanese export curbs.

“Both Korea and Japan are key nations in such global supply chains as semiconductor production,” Yoon said.

“Stronger economic cooperation between Korea and Japan will likely contribute greatly to boosting global supply chains.”

KYIV, Ukraine — Ukraine said on Tuesday that the battle for Bakhmut, an industrial city in Donbas and site of the longest battle of Russia's invasion, was key to holding back Moscow along the entire front.

"The defensive operation in this area is of crucial strategic importance to deterring the enemy. It is key to the stability of the defence of the entire front," said Ukraine's most senior military official, Valery Zaluzhny.

Ukraine's defence of the city is becoming precarious, with Russian ground forces led by the Wagner mercenary group reporting gains that signal the city could soon be encircled.

But President Volodymyr Zelensky's office said in a statement Tuesday that the Ukrainian leader had met with senior military commanders and agreed his forces should remain in the embattled city.

"Having reviewed the course of the defensive operation in the Bakhmut sector, all members of the [Supreme Commander-in-Chief's] Staff expressed a common position on further holding and defending Bakhmut," his office said in a statement.

Analysts have played down the strategic significance of Bakhmut as a military prize but the city has gained important political stature, with both sides pouring resources into the fight.

The city, which had an estimated pre-war population of some 70,000 people remains an important urban hub in the Donetsk region, which the Kremlin claimed to have annexed last year despite not fully controlling.

The Russian-installed head of the Donetsk region, Denis Pushilin, told journalists on Tuesday that "fierce battles" were raging "for every metre" of Bakhmut.

"The Ukrainian regime absolutely does not take into account numerous losses," he said.

The head of the Wagner group that has claimed to be leading Russia's assault on Bakhmut meanwhile said that Ukraine was consolidating forces for a counter-attack.

"They are absolutely preparing," Yevgeny Prigozhin said in a statement on social media, outlining what he said were Kyiv's plans to beat back his troops encircling the city.

MOGADISHU — At least five people were killed and 11 others wounded, including a regional governor, in a suicide attack on Tuesday in southern Somalia, police said, a bombing claimed by Al Shabaab militants.

A vehicle laden with explosives ploughed into a guest house hosting government officials in Bardera, 450 kilometres  west of the capital Mogadishu, said Hussein Adan, police commander for the area.

"The explosion destroyed most parts of the building and five security guards died in the blast," Adan told AFP.

Eleven people, including the governor Ahmed Bulle Gared, were injured, he added.

Al Shabaab, linked to Al Qaeda, has been waging a bloody insurgency against the central government in the fragile Horn of Africa nation for about 15 years.

The group claimed responsibility for the attack through their Shahada News Agency, according to the US monitoring group SITE.

Mohamud Saney, who witnessed Tuesday's attack, said he had "never heard anything as big as the explosion".

"It shook the earth like an earthquake."

In recent months, the Somali army and local clan militias have retaken chunks of territory from the militants in an operation backed by US air strikes and an African Union force known as ATMIS.

Despite the gains by the pro-government forces, the militants have continued to demonstrate an ability to strike with lethal force against civilian and military targets.

In the deadliest Al Shabaab attack since the offensive was launched last year, 121 people were killed in October by two car bomb explosions at the education ministry in Mogadishu in October.

The UN last month said that 2022 was the deadliest year for civilians in Somalia since 2017, largely because of an increase in mass-casualty attacks by the terrorist group.

Although forced out of Mogadishu and other main urban centres more than a decade ago, Al Shabaab remains entrenched in parts of rural central and southern Somalia.

FRANKFURT, Germany — Two schoolgirls have confessed to stabbing to death a 12-year-old girl in Germany, police said on Tuesday, in a case that has shocked the country.

The victim, known only as Luise, went missing on Saturday afternoon after leaving a friend’s house near the town of Freudenberg, in the western state of North Rhine-Westphalia.

Luise’s body was found the following day in a wooded area not far from her home.

“The child died as a result of numerous knife wounds and the resulting loss of blood,” Koblenz Prosecutor Mario Mannweiler told a press conference, adding that there was “no indication of a sexual offence”.

Two girls, aged 12 and 13, had confessed to the murder, added Florian Locker, head of Koblenz police’s homicide department.

The two girls “made statements about the matter and in the end admitted the crime”, Locker said.

The girls and Luise knew each other, Mannweiler added.

But he declined to give further details because of the age of the suspects, who are too young to be held criminally responsible for their actions in Germany.

In Germany, the age of criminal responsibility starts at 14 years.

Investigators have yet to find the knife or knives used in the attack, Mannweiler added.

“This is of course a very unusual and shocking act, even for us,” Mannweiler told reporters.

Flowers and candles 

Luise had been meant to walk home from her friend’s place but her parents raised the alarm on Saturday evening after she failed to return.

Her disappearance sparked a massive search operation that included dozens of police, a helicopter, drones and sniffer dogs.

The regional leader of North Rhine-Westphalia state, Hendrik Wuest, said the killing had left him “stunned”.

“It’s unimaginable and almost unbearable that children could be capable of such acts,” he said.

Local residents placed flowers and candles near the woodland area where Luise’s body was found. Police officers were still scouring the crime scene for evidence on Tuesday.

Luise’s school replaced its homepage with a message of condolence.

“We lost our pupil, classmate and friend Luise at the weekend,” the Esther-Bejarano comprehensive school in Freudenberg said in the statement.

“Far too early, she was violently torn from our midst and from her family. Our thoughts and wishes are with her family and friends now and in the coming days.”

The case revived memories of the notorious 1993 murder of two-year-old James Bulger in England. The toddler was abducted and tortured before he was killed by two 10-year-old boys, Robert Thompson and Jon Venables.

KYIV — Fierce fighting is raging for control of the centre of Bakhmut in eastern Ukraine, the longest-running and bloodiest battle of Moscow's invasion, Russian and Ukrainian forces said Monday.

Ukraine said that Russia's Wagner mercenary group, which has claimed to be leading Moscow's charge for the industrial city, was pushing forward in the city that has been the epicentre of fighting for months. 

"Wagner assault units are advancing from several directions, trying to break through our troops' defensive positions and move to the centre of the city," the Ukrainian military said in a morning briefing.

"In fierce battles, our defenders are inflicting significant losses on the enemy," it added.

Ukraine has said its strategy with the defence of Bakhmut is to degrade Russia's ability to launch any further offensive in the coming months and buy time to ready its bid to recapture ground.

Analysts are divided over the strategic significance of Bakhmut as a military prize but the city has gained important political stature, with both sides pouring significant resources into the fight.

Bakhmut municipal officials on Monday told Ukrainian media that there were still more than 4,000 people living in the town, including 33 children. 

Wagner head YevgenyPrigozhin also acknowledged that his forces were coming up against determined resistance as they sought to wrest control of the city's centre.

"The situation in Bakhmut is difficult, very difficult. The enemy is battling for every metre," Prigozhin said in a post on social media.

"The closer we are to the city centre, the more difficult the battles get and the more artillery there is... Ukrainians are throwing endless reserves [at the fight]," Prigozhin said.

Kyiv has cautioned the city's fall would give Russian forces a clear path deeper into the Donetsk region, which the Kremlin claimed to have annexed to Russia last year.

Russia has reported painstaking gains around Bakhmut in recent weeks, making progress on encircling the city, but it has not made significant territorial gains in months.

The capture of the city would provide the Kremlin with a military win to sell to its domestic audience.

NATO warned last week that Bakhmut could fall within a matter of days while Ukraine leader Volodymyr Zelensky has vowed to continue to hold the city “as long as possible”.

Zelensky on Monday published a decree posthumously awarding the highest state honour to a soldier killed by Russians after being taken prisoner near Bakhmut.

The soldier, Oleksandr Matsievsky, was videoed apparently being gunned down by Russian forces for saying “Glory to Ukraine”, in a video that went viral. 

Russia’s invasion of Ukraine, now more than a year old, has seen arms imports into Europe almost double in 2022, driven by massive shipments to Kyiv, which has become the world’s third-largest arms destination, researchers said Monday.

“The invasion has really caused a significant surge in demand for arms in Europe, which will have further effect and most likely will lead to increased arms imports by European states,” Pieter Wezeman, a senior researcher at the Stockholm International Peace Research Institute, told AFP.

Russia’s attack has had “devastating” consequences for children in residential institutions, with thousands transferred to occupied territories or to Russia, Human Rights Watch also said Monday.

“This brutal war has starkly shown the need to end the perils faced by children who were institutionalised,” said Bill Van Esveld, associate children’s rights director at the New York-based organisation.

At least several thousand children have been transferred to Russia or occupied territories, the report said.

NEW YORK — The US banking system has been gripped in recent days by a series of convulsions that has seen the collapse of three banks and authorities undertaking extraordinary measures to reassure depositors.

It all began Wednesday night with a liquidation announcement from the small regional Silvergate Bank, a favourite among the cryptocurrency crowd. 

The California business was swept up in several crypto mishaps, particularly the implosion of exchange platform FTX, before facing a wave of sudden withdrawals.

Later that same night, medium-sized institution Silicon Valley Bank announced it was facing a huge run of unexpected withdrawals.

SVB, a key lender to startups across the United States since the 1980s and the country’s 16th-largest bank by assets, had been hit by the tech sector slowdown as cash-hungry companies rushed to get their hands on their money.

SVB — along with other banks — was also dealing with the effects of the Federal Reserve’s policy U-turn as the US central bank has moved aggressively over the last year to counter inflation by hiking interest rates. 

Banks typically borrow money under short-term instruments while loaning using long-term vehicles.

Ordinarily, this dynamic is beneficial because interest rates on long-term instruments are higher than those on short-term bonds.

But because of the volatility unleashed by the Fed’s policy pivot, there has been an “inversion” of the bond yield curve.

Run on deposits 

The extent of SVB’s trouble emerged in a presentation last Wednesday. 

While the bank emphasiaed the strength of its balance sheet and the relatively low proportion of its loans compared to its deposits, it also announced a capital increase of $2.25 billion and revealed that after an emergency sale of a portfolio of financial securities worth $21 billion it still came out with a loss of $1.8 billion. 

The announcement spooked investors and clients, and sparked a run on deposits. 

On Thursday alone, SVB saw an estimated $42 billion of withdrawal orders.

It was not able to honour all those requests, and posted a negative cash position of nearly $1 billion by the end of the day.

On the stock market, SVB tanked by 60 per cent.

Trading was halted on Friday before the Federal Deposit Insurance Corporation (FDIC) took over the bank and said it would protect insured deposits — those up to $250,000 per client.

But the FDIC’s guarantee only covered about four percent of the bank’s deposits, with most accounts well over that limit and clients left uncertain as to whether they would be able to recover their money in full. 

The biggest US banks are considered stable, in part because of strict requirements enacted after the 2008 financial crisis.

But other mid-sized and regional institutions have been pressured by worries of a similar run on deposits to that suffered by SVB. 

Shares in the New York Signature Bank, California PacWest and the Arizona-based Western Alliance all dropped 20 per cent on the day. 

Averting panic 

With SVB’s future, and billions in deposits up in the air, officials from the Fed, the FDIC and the Treasury raced to craft a solution, hoping to avert a potential financial panic before financial markets opened in Asia.

To stop one bank’s failure from spreading into a systemic banking crisis, the three federal agencies announced on Sunday that SVB depositors would have access to “all of their money” starting on Monday, March 13, and that American taxpayers will not have to foot the bill. 

The same statement revealed that Signature Bank, the 21st-largest in the country, was automatically closed on Sunday and that its customers would benefit from the same measures as those at Silicon Valley Bank.

In a potentially major development, the Fed announced it would make extra funding available to banks to help them meet the needs of depositors, which would include withdrawals. 

On Monday, President Joe Biden praised the “immediate action” by regulators while trying to offer reassurances.

“The bottom line is this: Americans can rest assured that our banking system is safe. Your deposits are safe,” Biden said.