South Korea Names New Defense Head as North Talks War

South Korean President Lee Myung Bak appointed a former top military commander as defense minister as tensions rise before exercises with the U.S. that North Korea said will take the peninsula to the “brink of war.”

Former Joint Chiefs of Staff Chairman Kim Kwan Jin, 61, replaces Kim Tae Young, who quit amid criticism that the military’s response to a North Korean attack on a disputed island was inadequate. Kim had offered to leave office in May, two months after the sinking of the South Korean warship Cheonan, which claimed the lives of 46 sailors.

Investors sold Asian stocks and made the South Korean won the worst-performer among major Asian currencies against the dollar today as North Korea threatened a “shower of terrifying fire.” The nuclear-powered aircraft carrier USS George Washington was headed toward the Yellow Sea for joint drills with South Korea.

North Korea on Nov. 23 shelled a South Korean fishing community and military base with highly flammable ammunition that killed four people, including two civilian construction workers. The attack also blew the windows out of a school and torched houses.

Lee wants to “reconstitute the military policy landscape,” said Jasper Kim, an associate professor at Ewha Womans University’s Graduate School of International Studies in Seoul. “The current Lee Myung Bak administration was already hawkish, but now it’s entered into a hyper-hawkish foreign policy mode.”

Ratcheting Higher

Tensions on the Korean peninsula have been ratcheting higher since the March sinking. Lee’s government said it would strengthen the military and “more actively” retaliate against North Korean provocations after the attack on Yeonpyeong island, the first shelling of South Korean soil since the 1950-53 Korean War. North Korea said that it was responding to an encroachment on its territory and that it will “counter confrontation with confrontation and war with war,” according to the state-run Korean Central News Agency.

The MSCI Asia Pacific Index slid 1 percent as of 5:32 p.m. The won fell 1.9 percent against the dollar, declining for a third week. The benchmark Kospi stock index fell 1.3 percent.

Multiple explosions, coming from the direction of North Korea, were heard on Yeonpyeong between noon and 3 p.m. local time today. They are believed to be part of the North’s regular artillery drills, a defense ministry official in Seoul said. No shell landed in South Korean territory, said the official, declining to be named because of military policy.

U.S. Commander

Army General Walter Sharp, the commander of U.S. forces in South Korea, visited the island today and renewed calls on North Korea to stop additional attacks, according to an e-mailed statement from the United Nations Command. Sharp, also commander of the UN Command, reiterated that North Korea’s military should agree to talks with the UN Command, the statement said.

Kim Kwan Jin, a former army general, served as the country’s top commander between 2006 and 2008. During his 40-year year military career, he worked in key “strategy and field units,” Lee’s office said in the statement.

Lee accepted Kim Tae Young’s resignation yesterday “in an attempt to restore the discipline of the military,” his office said in a statement. Lee will also replace his secretary of national defense, according to yesterday’s statement.

South Korea axed Joint Chiefs of Staff Chairman Lee Sang Eui in June amid accusations he had been drinking at dinner the night the Cheonan sank and was too drunk to have given orders properly. The military had come under public criticism at the time for not responding properly to the sinking.

Torpedo

A South Korean-led international panel concluded on May 20 that North Korea fired a torpedo from a mini-submarine to sink the 1,200-ton Cheonan. Almost one in four South Koreans said they didn’t trust the panel’s finding, according to a poll commissioned by the Hankook Ilbo newspaper on May 24.

Lee announced he would cut off trade and aid to the North and take the case to the United Nations. China blocked any punishment or condemnation of its ally at the UN, and South Korea’s Red Cross has since given food to the North.

“I think with the Cheonan incident, President Lee Myung Bak wanted to do more, but couldn’t because he didn’t have the political will,” Ewha’s Kim said. “Now, if he doesn’t do something very strongly, then people will view him as weak.”

North Korea has sought to justify the shelling on what it termed South Korea’s “military provocation” in disputed waters. Kim Jong Il’s regime warned of more strikes if South Korea violates its territory in at least four statements this week via the official Korean Central News Agency.

China’s Influence

Yeonpyeong lies about two miles from a border demarcated by the UN after the war and never accepted by the North. North Korea claims that the border should be drawn farther south to include Yeonpyeong and four neighboring islands as part of its territory. The Cheonan also sank in this disputed area.

President Barack Obama sent the USS George Washington to the Yellow Sea for previously scheduled joint drills with South Korea between Nov. 28 and Dec. 1. China’s Foreign Ministry warned today against having military exercises in the country’s “exclusive economic zone” without its authorization, Xinhua News Agency said.

“We hold a consistent and clear-cut stance on the issue,” Foreign Ministry spokesman Hong Lei said in a statement, according to Xinhua. “As the Korean Peninsula situation is highly complicated and sensitive, all parties concerned should stay calm and exercise restraint.”

Chinese Notified

The Pentagon reiterated that the U.S. military notified the Chinese of the planned exercise, as it has in the past. The drill was among several announced after the sinking of the Cheonan.

“This exercise and the whole series of exercises is not directed at the Chinese,” said U.S. Navy Captain Darryn James, a Pentagon spokesman. “It’s designed to strengthen deterrence against North Korea.”

While Obama, Lee and Japan’s Prime Minister Naoto Kan have urged China to use its influence to temper North Korean acts of aggression, Chinese Premier Wen Jiabao has reiterated calls for stability on the peninsula, without ascribing any blame to the North. Hong told reporters in Beijing it was evident that North and South Korea disagreed on which side started the clash.

Chinese Foreign Minister Yang Jiechi spoke to U.S. Secretary of State Hillary Clinton and South Korean Foreign Minister Kim Sung Hwan by telephone, and directly to North Korea’s ambassador to China, according to China’s Foreign Ministry. Yang called on North Korea and South Korea to remain calm, exercise restraint, and resolve the situation through dialogue, the ministry said on its website today.

China is the North Korean regime’s main economic and political benefactor and the two countries fought together against UN forces during the Korean War.