China rules out war over N. Korea but not sanctions

China on Tuesday declined to rule out possible U.N. sanctions against North Korea for carrying out a nuclear test but said any military action was unimaginable.

It said it had no information about widespread speculation that the secretive North might be ready to conduct a second test.

Asked what Beijing thought of the possibility of military action, Foreign Ministry spokesman Liu Jianchao told a news conference: “I think this is an unimaginable way.”

Analysts say the Stalinist North’s announcement on Monday it had conducted an underground nuclear test was almost certainly a bid to push the United States into ending a painful crackdown on its finances and finally agree to one-on-one negotiations.

South Korea’s Yonhap news agency quoted a North Korean official as saying his country would only return to six-country talks to end its nuclear development if Washington made concessions.

“We are still willing to abandon nuclear programmes and return to six-party talks … if the United States takes corresponding measures,” it quoted the unidentified official as saying from Beijing.

But he added that Pyongyang was prepared to put nuclear warheads on missiles and conduct additional nuclear tests “depending on how the situation develops”.

Far from making concessions, the United States and Japan — a traditional target for North Korean hostility — pushed at the United Nations on Monday for harsh sanctions.

Even South Korean President Roh Moo-hyun vowed to review his “sunshine policy” of engagement with the reclusive state. Newspaper commentators slammed him for being too soft, with one declaring the country in its worst crisis since the Korean War more than half a century ago.

China’s Foreign Ministry said it was taking active steps to encourage North Korea to return to the six-party talks but warned Pyongyang that it had damaged relations with the only country that comes close to being its ally.

Pyongyang’s declaration was a sharp blow to Chinese President Hu Jintao’s doctrine of using economic and diplomatic coaxing to end North Korea’s drive to become a nuclear weapons state.

“We think the U.N. Security Council should take appropriate action,” ministry spokesman Liu said, adding that Beijing was still mulling what that action should be.

The yen hit an eight-month low against the dollar on talk that Pyongyang had conducted a second test, extending losses after North Korea’s announcement the day before.

U.N. Weighs Sanctions

With world leaders condemning the impoverished state’s declaration, Washington drafted a U.N. resolution calling for international inspections of all cargo moving into and out of North Korea to detect weapons-related material.

It also sought a freeze on transfers or development of weapons of mass destruction and a ban on imports of luxury goods.

The text was due to be discussed in the Council on Tuesday.

Japan proposed more stringent steps. These included banning North Korean ships and planes from all ports if they carried nuclear or ballistic missile-related materials.

Japan effectively froze remittances and transfers to North Korea by those suspected of links to the development of weapons of mass destruction after missile tests by Pyongyang in July.

However, officials in Tokyo made clear that, before adding fresh sanctions, Japan wanted confirmation of whether the underground test declared by North Korea actually took place.

“This is an especially grave threat and challenge to the security of our nation,” Japanese Prime Minister Shinzo Abe told a parliament committee. “Should we confirm this, we need to swiftly take our own tough measures against North Korea.”

A U.S. official said it could take several days for intelligence analysts to determine whether the event in an area near North Korea’s border with China was an unsuccessful nuclear test, a small nuclear device or a non-nuclear explosion.

“If it was a nuclear test, it appears to be more of a fizzle than a pop,” the official said.

Officials in Japan, South Korea and China all said they had no detected any change in radiation levels.

Analysts say North Korea probably has enough fissile material to make six to eight nuclear bombs but probably lacks the technology to devise one small enough to mount on a missile.

North Korea’s move was a slap in the face for regional and world powers engaged in six-country talks aimed at unravelling its nuclear programme.

U.S. Democrats, eager to oust Republicans from control of Congress in next month’s mid-term elections, wasted no time on Tuesday in accusing President George W. Bush of being in a state of denial about North Korea as he pursued a war in Iraq.

(Additional reporting by Kim So-young and Jon Herskovitz in Seoul, Lindsay Beck and Chris Buckley in Beijing, Ben Blanchard in Dandong, Evelyn Leopold at the United Nations and David Morgan, Carol Giacomo, Kristin Roberts, Steve Holland and Andrea Shalal-Esa in Washington)