World

ANKARA — Prime Minister Recep Tayyip Erdogan said on Tuesday he would ask the United States to extradite an Islamic cleric he accuses of plotting to topple him and undermine Turkey with concocted graft accusations and secret wire taps.

Fethullah Gulen has lived in self-imposed exile in Pennsylvania since 1997, when secularist authorities raised accusations of Islamist activity against him. Erdogan accuses him of building a “parallel state” of followers in institutions such as the police and judiciary and using them to try to pull the levers of state power.

Gulen, a former ally, denies engineering a police graft investigation which has seen three Cabinet ministers quit, but has denounced Erdogan over moves to shut down the inquiry by purging police and judiciary of his followers.

Asked by a reporter at parliament after a meeting of his ruling AK Party if a process would begin for Gulen’s extradition, Erdogan said: “Yes, it will begin.”

In an interview with PBS talk show host Charlie Rose broadcast late on Monday, Erdogan said Gulen could also pose a threat to US security by his activities.

“These elements which threaten the national security of Turkey cannot be allowed to exist in other countries because what they do to us here, they might do against their host,” Erdogan told Rose in the interview, according to a transcript.

Erdogan has drawn accusations of increasing authoritarianism with his response to the graft investigation, which has included removing thousands of police officers and hundreds of judges and prosecutors, as well as imposing a two-week ban on Twitter and broadening the powers of the state intelligence service.

Human Rights Watch on Monday criticised a new law giving the national intelligence agency (MIT) more scope for eavesdropping, greater immunity from prosecution for top agents and jail terms for leaks of sensitive information, saying it gave the agency “carte blanche” and was open to abuse.

The government has said the law replaces outdated legislation and brings Turkey in line with international norms.

German President Joachim Gauck criticised Erdogan’s leadership style during a trip to Turkey on Monday and warned against curbing freedom of expression.

“Presumably he still thinks he is a clergyman,” Erdogan said of Gauck, a former Lutheran pastor, adding his comments showed a lack of statesmanship and that he was “saddened” by his attitude.

Extradition

Erdogan said Turkey had complied with more than 10 extradition requests from the United States and now expected the same response from its NATO ally. But it was not clear on what basis an extradition might be agreed.

Turkish authorities would first need to issue an arrest warrant for Gulen and produce evidence indicating he has committed a crime, according to the 1979 treaty signed between the two countries.

“If he was tried in Turkey and had been convicted, then you can send that court ruling. You can request extradition for the implementation [of that sentence],” said former European Court of Human Rights judge Riza Turmen, a deputy from the main opposition CHP Party.

“But none of these are currently the case,” he told Reuters.

The 1979 treaty also exempts all crimes of a “political character” unless they can be shown to have targeted either the head of state or head of government, or their families.

Erdogan said Turkey had cancelled Gulen’s passport and that he was in the United States as a legal resident on a green card.

The US embassy in Ankara had no immediate comment.

Gulen runs a network of businesses and schools, well-funded and secular in nature, across the world. The schools are a major source of influence and funding and have become the target of government efforts to have them shut down.

Erdogan accuses Gulen of contriving criminal allegations that his son and the children of three ministers were involved in a corruption scandal and took billions of dollars of bribes.

He has also accused Gulen’s Hizmet (Service) movement of bugging thousands of phones and leaking audio recordings, including purportedly of his foreign minister and senior security officials discussing possible armed intervention in neighbouring Syria, on the website YouTube.

Gulen has denied these accusations.

The recordings appeared ahead of a March 30 municipal election, but did little to affect Erdogan’s popularity, with his AK Party dominating the electoral map.

MANILA — Barack Obama’s Asia-Pacific legacy is now taking shape, but he has work to do to complete a genuine rebalancing of US power to the region that goes beyond rhetoric.

The US leader ended his four-nation Asian tour in the Philippines Tuesday, after spending a week telling China not to use coercion in maritime disputes and reassuring allies that US security guarantees are genuine.

He made it clear that America’s defence alliance with Japan did cover disputed islands known as the Senkakus to Toyko and the Diaoyus to China.

He clinched a 10-year defence pact with the Philippines, similar to one already agreed with Australia, that will put US forces close to the volatile geopolitical currents of the South China Sea.

Obama also became the first American president to visit Malaysia for nearly 50 years — formally ushering the country into the US orbit after its decades of outspoken anti-Americanism.

Malaysia’s evolution complements the administration’s move in pushing reform in Myanmar and drawing the once junta-led nation away from China.

Senior US officials said Obama privately pressed Japanese Prime Minister Shinzo Abe to consider the explosive regional political impact of visiting war shrines — particularly the impact on relations with US ally South Korea.

But despite administration claims that Obama engineered a significant breakthrough, he has yet to close a deal on opening Japan’s auto and agricultural markets.

That left a 12-nation Trans Pacific Partnership trade deal in limbo.

Obama needs the TPP to take the Asia pivot beyond a reshuffling of military assets and to claim a piece of the region’s dynamic future for the slowly recovering US economy.

Asian doubts over whether Obama can get any trade deal through Congress are also contributing to the uncertainty.

While his rebalancing strategy is premised in part on exploiting the anxiety of regional states about China’s rise, Obama also needs to keep tensions with the Asian giant under control.

While warning China over its conduct in territorial disputes in the East and South China Seas, which US officials privately fear could erupt into shooting incidents sooner if not later, Obama was careful not to antagonise Beijing.

In return China kept its denunciations of the US-Philippines defence deal, which will see forces rotate through the country, comparatively muted.

The trip “was not a complete success”, said Joseph Cheng, a political scientist at the City University of Hong Kong.

“However... [Obama] demonstrated that he attaches a high priority to the region in line with his return-to-Asia strategy.”

This trip was one that Obama had to make: his cancellation of a regional tour last year due to political dysfunction in Washington made allies question US staying power.

And even while selling his rebalancing policy all over again, Obama was preoccupied by crises elsewhere that threaten to distract him from Asia, including the East-West showdown over Ukraine.

Daniel Twining, an Asia analyst with the German Marshall Fund of the United States who worked on foreign policy for former president George W. Bush, said a number of Obama’s moves represented a “smart investment” for Washington.

But he warned: “Our big Asian allies remain worried.”

Twining said the absence of a trade deal with Japan and niggles in implementing the Korea-US trade pact “are setbacks, and reflect the president’s unwillingness to sell the US global trade agenda to Democrats in Congress”.

To some extent, Obama may always find it difficult to fulfil hopes in the region for his Asia policy.

By having characteristically raised expectations by declaring himself America’s first “Pacific President”, he ensured regional states will always want more.

The fact that America is a Pacific nation but not an Asian one will always render Washington an outsider to some extent — and promote Chinese suspicions of US motives in its backyard.

So it was significant that Obama repeatedly made it clear that Washington did not seek to “contain” or “counter” China.

One clear deficit on Obama’s Asia legacy is his failure to produce new ideas to rein in unpredictable North Korea.

Though a feared nuclear test by Pyongyang did not materialise during his visit, Obama’s presidency will go down in history as a time when the Stalinist state increased its nuclear arsenal.

His next trip to Asia is scheduled for November, when he will travel to regional summits in Beijing, Myanmar and Australia.

KOSTYANTYNIVKA, Ukraine — The United States and Europe on Monday whacked Russia with fresh sanctions over Ukraine for failing to stop tensions soaring in the east of the ex-Soviet republic, where rebels seized another town and a pro-Moscow mayor was badly wounded by a shot to the back.

As the West sought to step up the pressure on Moscow over the worst East-West crisis since the Cold War, the White House imposed sanctions on seven Russian officials and 17 firms close to President Vladimir Putin.

The European Union was adding 15 names to its own list, diplomatic sources said.

The Kremlin hit back almost immediately, vowing a “painful” response for Washington, in a tit-for-tat rhetorical battle.

Russian Deputy Foreign Minister Sergei Ryabkov told the Interfax news agency that Moscow was “disgusted” by the US action, which he said showed Washington had “completely lost touch with reality”.

The US said it was prepared to “impose still greater costs” on Russia for what it called its “illegal intervention and provocative actions” in Ukraine.

Among those targeted is Igor Sechin, president and chairman of the board at Rosneft, Russia’s top petroleum company and one of the world’s largest publicly traded oil companies.

Washington is also tightening licensing requirements for certain high-tech exports to Russia that could have a military use.

The Western sanctions are a response to Russia’s perceived lack of action in implementing an April 17 deal struck in Geneva to defuse the crisis.

Washington has threatened to target specific sectors of the Russian economy if the tens of thousands of troops the Kremlin has ordered to the border actually invade Ukraine.

‘Shot in the back’ 

As the sanctions hammer swung at Russia, tensions on the ground in eastern Ukraine showed little sign of easing. 

Kalashnikov-toting militants seized the town hall of Kostyantynivka — the latest of more than a dozen towns held by pro-Russian insurgents who were supposed to have disarmed under the Geneva deal.

AFP reporters in the nearby flashpoint town of Slavyansk said militants on rebel-held checkpoints were visibly more agitated.

Some 300 masked men wielding baseball bats attacked a bank in the regional hub of Donetsk owned by a billionaire oligarch and regional governor who has clashed with Putin.

The pro-Moscow mayor shot in the back, Gennady Kernes, of the town of Kharkiv, was in critical condition. The identity and motive of the gunman who targeted him while he was riding his bicycle were unknown.

Meanwhile, negotiations were still under way to secure the release of a team of international observers from the OSCE, whose capture by rebels on Friday sparked global fury.

The pan-European security organisation held an emergency meeting in Vienna to discuss the rising threat in Ukraine to monitors overseeing the faltering Geneva accord.

The current head of the Organisation for Security and Cooperation in Europe (OSCE), Swiss President Didier Burkhalter, told AFP: “We don’t want to stop, but it is our responsibility to assess the situation steadily... If there is a change, then we will act.”

On Sunday, the rebels presented the OSCE captives — four Germans, a Pole, a Dane, a Czech and a Swede — to the cameras for a news conference slammed as “repugnant” by Germany.

The Swede, who suffers from diabetes, was released late Sunday on medical grounds.

A spokeswoman for the rebels said all seven were “alive and in good health” but scrapped a news conference planned for later Monday.

The International Committee of the Red Cross told AFP it was trying to gain access to the detainees and urged all sides to treat captives “humanely”.

The rebels are also holding three Ukrainian soldiers captured near Slavyansk. Russian television showed the men blindfolded, cuffed and bloodied, stripped to their undergarments.

‘Painful’ response 

The Kremlin issued a robust response to the US sanctions, which President Barack Obama had earlier announced in Manila, where we was wrapping up a tour of Asia.

“We will, of course, respond,” Ryabkov said, adding: “We are certain that this response will have a painful effect on Washington.”

The measures taken by Washington and Brussels are “leading things towards an escalation of the crisis”, the minister added.

After a brief period of optimism prompted by the Geneva accord, the crisis has lurched into increasingly dangerous ground, with the Ukrainian prime minister warning that Moscow wanted to trigger a “third world war” with its military manoeuvres near the border.

Ukraine’s army is waging an offensive to quell the separatist movement in the eastern part of the country, which the West believes is fomented and controlled by the Kremlin.

Kiev’s soldiers are surrounding the flashpoint town of Slavyansk in a bid to prevent reinforcements reaching militants there.

Ukraine also threatened to take Russia to court over its threat to cut off gas supplies if Kiev does not pay its bills.

Prime Minister Arseniy Yatsenyuk told reporters Ukraine would pay $2.2 billion to Russia’s state-owned gas company Gazprom if it accepts a price of $268 per 1,000 cubic metres.

“We are waiting for a Gazprom answer.... Unless we reach an agreement within 30 days, we will move from pre-arbitration phase to a legal case,” he said.

The crisis has escalated at breathtaking pace since November when pro-Western protesters in Kiev began mass demonstrations against Kremlin-backed then-president Viktor Yanukovych after he rejected an agreement to bring Ukraine closer to the European Union.

After four months of protests, which turned deadly as authorities tried to break them up, Yanukovych was forced from power.

In response, Moscow launched a blitz annexation of the peninsula of Crimea and stepped up troop movements on the border.

LITTLE ROCK, Arkansas — Rescue workers searched for survivors on Monday in the rubble left by a wave of tornadoes that ripped through the south-central United States a day earlier, killing at least 16 people in Arkansas, Oklahoma and Iowa.

Arkansas was the hardest hit, with at least 10 people dead in central Faulkner County and four more across the state, for the first reported fatalities of this year’s US tornado season, authorities said.

Strong winds wrenched houses off their foundations and flipped cars on top of the rubble in the small town of Vilonia in Faulkner County.

One person was killed in neighboring Oklahoma and another in Iowa, state authorities said.

A tornado hit the east side of Mayflower, Arkansas, on Sunday evening, killing at least one person, tearing up trees and bringing down power lines, making it difficult for the emergency services to find stricken areas in the dark, officials said.

The Arkansas National Guard was deployed to help out.

At least one other person was killed in a tornado in the town of Quapaw, in the northeast corner of neighboring Oklahoma, according to Ottawa County Sheriff’s Department spokesman Derek Derwin.

That twister was spotted in the town 320km northeast of Oklahoma City, according to the weather service.

Another fatality was reported on a farm in northeastern Keokuk County in Iowa by the local sheriff’s office last night, said John Benson, a spokesperson for Iowa Homeland Security and Emergency Management.

A tornado in Baxter Springs, Kansas that touched down on Sunday evening destroyed as many as 70 homes and 25 businesses, and injured 34 people, of whom nine were hospitalised, state and county officials said.

One person was reported dead but it was unclear if the death was storm-related, said the Cherokee County Sheriff’s Office.

Overnight tornado watches and warnings were announced in several parts of Arkansas, Tennessee and Mississippi.

CANBERRA, Australia — The aerial search for the missing Malaysia Airlines jet was called off Monday, and the underwater hunt will be expanded to include a vast swath of ocean floor that may take at least eight months to thoroughly search, Australian officials said.

Not a single piece of confirmed debris from Malaysia Airlines Flight 370 has been recovered by a massive multinational hunt that began after it disappeared March 8 with 239 people on board.

“It is highly unlikely at this stage that we will find any aircraft debris on the ocean surface. By this stage, 52 days into the search, most material would have become waterlogged and sunk,” Prime Minister Tony Abbott said.

“Therefore, we are moving from the current phase to a phase which is focused on searching the ocean floor over a much larger area,” he said.

The US Navy’s Bluefin 21 robotic submarine has spent weeks scouring the initial search area for the plane in the remote Indian Ocean far off Australia’s west coast, but has found no trace of the missing aircraft. Officials are now looking to bring in new equipment that can search a larger patch of seabed for the plane, Abbott said.

The aerial search officially ended Monday, the search coordination center confirmed.

Radar and satellite data show the jet veered far off course for unknown reasons during a flight from Kuala Lumpur, Malaysia, to Beijing. Analyses indicate it would have run out of fuel in the remote section of ocean where the search has been focused.

The unmanned sub has been creating a three-dimensional sonar map of the ocean floor for more than two weeks near where signals consistent with airplane black boxes were heard on April 8. The sub has searched a nearly 400-square-kilometre area.

Crews will now begin searching the plane’s entire probable impact zone, an area 700 kilometres long and 80 kilometres wide, Abbott said.

That will be a monumental task — and one that will take time, warned Angus Houston, head of the search effort.

“If everything goes perfectly, I would say we’ll be doing well if we do it in eight months,” Houston said, adding that weather and technical issues could prolong the search well beyond that estimate.

Australian officials will be contacting private companies to bring in additional sonar mapping equipment that can be towed behind boats to search the expanded area at an estimated cost of $60 million, Abbott said. It could take officials several weeks to organize contracts for the new equipment and the Bluefin will continue to scour the seabed in the meantime, Abbott said.

So far, each country involved in the search has been bearing its own costs. But Abbott said Australia would now seek contributions from other countries to help pay for the new equipment.

Two weeks ago, Abbott said officials were “very confident” that a series of underwater signals picked up by sound-detecting equipment came from Flight 370’s black boxes. On Monday, he maintained that he still had a “considerable degree of confidence” — but opened up the possibility that the signals were yet another dead end in a search that has been peppered by them.

“We’re still baffled and disappointed that we haven’t been able to find undersea wreckage based on those detections, and this is one of the reasons why we are continuing to deploy the Bluefin 21 submersible — because this is the best information that we’ve got,” Abbott said. “It may turn out to be a false lead, but nevertheless it’s the best lead we’ve got.”

Abbott also acknowledged it was possible that no debris from the plane would ever be found.

“Of course it’s possible, but that would be a terrible outcome because it would leave families with a baffling uncertainty forever,” he said. “The aircraft plainly cannot disappear — it must be somewhere — and we are going to do everything we reasonably can, even to the point of conducting the most intensive undersea search which human ingenuity currently makes possible of some 60,000 square kilometres under the sea.”

“We are going to do all these things because we do not want this crippling cloud of uncertainty to hang over these families and the wider traveling public,” he said.

KUALA LUMPUR/SLAVYANSK, Ukraine — Pro-Russian rebels in Ukraine freed a Swedish observer on Sunday, but said they had no plans to release seven other European monitors they have been holding for three days.

On the eve of an expected announcement of a mild tightening of Western sanctions against a targeted list of Russians, US President Barack Obama called for the United States and Europe to join forces to impose stronger measures to restrain Moscow.

In Donetsk, where pro-Russian rebels have proclaimed an independent “people’s republic”, armed fighters seized the headquarters of regional television and ordered it to start broadcasting a Russian state TV channel.

Washington and Brussels are expected, possibly as early as Monday, to add new people and firms close to Russian President Vladimir Putin to a small list of those hit by punitive measures. But they have yet to reach a consensus on imposing wider sanctions that would hurt Russia’s economy more generally.

Speaking during a visit to Malaysia, Obama said the impact of any decision over wider sanctions would depend on whether the United States and its allies could find a unified position.

“We’re going to be in a stronger position to deter Mr. Putin when he sees that the world is unified and the United States and Europe is unified rather than this is just a US-Russian conflict,” Obama told reporters.

The stand-off over Ukraine, an ex-Soviet republic of about 45 million people, has dragged relations between Russia and the West to their lowest level since the end of the Cold War.

After Ukrainians overthrew a pro-Russian president, Putin overturned decades of international diplomacy last month by announcing the right to use military force on his neighbour’s territory. He has seized and annexed Ukraine’s Crimea peninsula and massed tens of thousands of troops on the frontier.

Heavily armed pro-Russian gunmen have seized buildings in towns and cities across eastern Ukraine. Kiev and its Western allies say the uprising is directed by Russian agents. Moscow denies it is involved and says the uprising is a spontaneous reaction to oppression of Russian speakers by Kiev.

An international agreement reached this month calls on rebels to vacate occupied buildings, but Obama said Russia had not “lifted a finger” to push its allies to comply.

“In fact, there’s strong evidence that they’ve been encouraging the activities in eastern and southern Ukraine.”

Prisoners

The Organisation for Security and Cooperation in Europe (OSCE) has sent unarmed monitors to try to encourage compliance with the peace deal. The pro-Russian rebels seized eight European monitors three days ago and have been holding them at their most heavily fortified redoubt in the town of Slavyansk.

One of them was permitted to leave on Sunday after OSCE negotiators arrived to discuss their release. The freed man got into an OSCE-marked car and drove away. A separatist spokeswoman said the prisoner, a Swede, had been let go on medical grounds, but there were no plans to free the rest.

The captives were shown to reporters on Sunday and said they were in good health.

“We have no indication when we will be sent home to our countries,” Colonel Axel Schneider told reporters as armed men in camouflage fatigues and balaclavas looked on. “We wish from the bottom of our hearts to go back to our nations as soon and as quickly as possible.”

The observers, from Germany, Denmark, Poland and the Czech Republic as well as Sweden, were accused by their captors of spying for NATO and using the OSCE mission as a cover.

The OSCE, a European security body, includes Russia as well as NATO members, and its main Ukraine mission was approved by Moscow, although the Europeans held in Slavyansk were on a separate OSCE-authorised mission that did not require Russia’s consent. Western countries say Russia should do more to prevail upon their pro-Russian captors to free the men.

Vyacheslav Ponomaryov, the rebel leader who has declared himself mayor of Slavyansk, has described them as prisoners of war and said the separatists were prepared to exchange them for fellow rebels in Ukrainian custody.

Washington is more hawkish on further sanctions than some of its European allies, which has caused a degree of impatience among some US officials. Many European countries are worried about the risks of imposing tougher sanctions: the EU has more than 10 times as much trade with Russia as the United States and imports about a quarter of its natural gas from Russia.

British Foreign Secretary William Hague said in coming days there would be “an expansion of existing sanctions, measures against individuals or entities in Russia”.

Russia! Russia!

At the Donetsk television headquarters, about 400 pro-Russian demonstrators chanted “Russia! Russia!” and “Referendum!” — a call for a vote like one in Crimea that preceded its annexation by Russia last month. Four separatists in masks controlled access at the entrance, and more masked gunmen in camouflage fatigues could be seen inside.

Oleg Dzholos, the station’s director, who came outside to speak to reporters, said the people who seized the building had ordered him to change the programming.

“They used force to push back the gates,” he said. “There were no threats. There were not many of my people. What can a few people do? The leaders of this movement just gave me an ultimatum that one of the Russian channels has to be broadcast.”

Ponomaryov, the rebel leader in Slavyansk, said his men had captured three officers with Ukraine’s state security service who, he said, had been mounting an operation against separatists in the nearby town of Horlivka.

The Russian television station Rossiya 24 showed footage it said was of a colonel, a major and a captain. They were shown seated, with their hands behind their backs, blindfolded, and wearing no trousers. At least two had bruises on their faces.

Ukraine’s State Security Service said the three had been part of a unit which went to Horlivka to arrest a suspect in the murder of Volodymyr Rybak, a pro-Kiev councillor whose body was found last week in a river near Slavyansk.

JINDO, South — Concerns are growing among anguished families that the bodies of those who died in the sinking of a South Korean ferry may never be found, as search teams suspended work Saturday because of bad weather.

A looming storm and high tides put a temporary halt to operations to recover the remains of more than 100 people still missing over a week after the huge ferry capsized.

“Over the weekend, strong wind and rain is expected in the Jindo area,” a coastguard spokesman told journalists.

“As efforts to find the missing people are becoming protracted, there are growing concerns among their families that bodies might be lost for good,” he said.

The confirmed death toll stood Saturday at 187, with 115 unaccounted for — many bodies are believed trapped in the ferry that capsized on April 16 with 476 people on board.

Making up the bulk of the passengers on the 6,825-tonne Sewol when it sank were 325 high school students — around 250 of whom are either confirmed or presumed dead.

Although all hope of finding survivors has been extinguished, there is still anger and deep frustration among relatives of the missing over the pace of the recovery operation.

Challenging conditions 

Frogmen have battled strong currents, poor visibility and blockages caused by floating furniture as they have tried to get inside the upturned vessel, which rests on a silty seabed.

The challenging conditions have meant divers are unable to spend more than a few minutes in the ship each time they go down.

Even so, they are coming across horrifying scenes in the murky water, including one dormitory room — which would normally have held around 31 people — packed with the bodies of 48 students wearing lifejackets.

Around a quarter of the 187 dead recovered so far have been found in waters outside the sunken vessel, and there are fears that some of the missing may have drifted free from the wreck.

That could be exacerbated if the sea is churned by the gathering storm, scattering bodies.

Authorities — wary of the palpable anger among relatives — have mobilised trawlers and installed 13-kilometre (eight-mile)-long nets anchored to the seabed across the Maenggol sea channel to prevent the dead being swept into the open ocean.

Dozens of other vessels and helicopters have been scouring the site and beyond, with the search operation expanded up to 60 kilometres from the scene of the disaster.

Police and local government officials will also be mobilised to scour coastal areas and nearby islands, a coastguard official said.

Widening investigation 

Furious families demanded a meeting with Choi Sang-hwan, deputy head of the Korea Coastguard, near the pier in Jindo Port, urging him to send the divers back into the water.

“We are waiting for the right moment as conditions in the sea are not favourable,” said Choi.

It took divers working in difficult and dangerous conditions more than two days to get into the sunken ferry and two more days to retrieve the first bodies.

Many relatives believe some of the victims may have survived for several days in trapped air pockets, but perished in the cold water after no rescue came.

As a result some have asked for autopsies to be performed, to see if it would be possible to determine the precise cause and time of death.

On Saturday, a US navy rescue and salvage vessel, the USS Safeguard, arrived at Jindo, AFP journalists on the scene said.

The vessel has “divers and other necessary equipment aboard, but it remains to be seen how the ship can contribute to the ongoing efforts to retrieve bodies”, a US military spokesman told AFP.

The Sewol’s captain, Lee Joon-seok, and 10 crew members have been arrested on charges ranging from criminal negligence to abandoning passengers.

The captain has been sharply criticised for delaying the evacuation order until the ferry was listing so badly that escape was almost impossible.

Prosecutors have raided a host of businesses affiliated with the ferry operator, the Chonghaejin Marine Company, as part of an overall probe into corrupt management.

The widening investigation has also seen travel bans put on eight current and former executives of the Korea Register of Shipping — the body responsible for issuing marine safety certificates.

SLAVYANSK, Ukraine — The Group of Seven (G-7) rich countries have agreed to start slapping fresh sanctions on Moscow as early as Monday over the worsening Ukraine crisis amid Western fears of an imminent Russian invasion.

International tensions were mounting Saturday over the situation in the ex-Soviet republic, where sporadic fighting between pro-Kremlin rebels and Ukrainian security forces flared last week.

Russian warplanes violated Ukraine’s airspace several times on Thursday and Friday, the Pentagon said.

Russia has also begun new drills on the border, where it has tens of thousands of troops massed.

A Western diplomat warned: “We no longer exclude a Russian military intervention in Ukraine in the coming days.”

The diplomatic source noted that Russia’s UN envoy, Vitaly Churkin, “has been recalled urgently to Moscow” for consultations.

Ukraine’s prime minister, Arseniy Yatsenyuk, on Saturday cut short a trip to Rome after seeing Pope Francis, skipping a Sunday canonisation ceremony for Popes John Paul II and John XXIII “because of the situation,” his spokeswoman told AFP.

OSCE team 

taken hostage 

On the ground in east Ukraine, Kiev’s Western-backed government is waging an offensive against pro-Moscow rebels holding a string of towns.

A 13-member OSCE military observer team sent into Ukraine to monitor an April 17 Geneva accord designed to de-escalate the situation was being held hostage by rebels in the flashpoint town of Slavyansk.

The chief of the insurgents’ self-styled “Republic of Donetsk”, Denis Pushilin, accused them of being “NATO spies” and said they would only be released in a prisoner swap for militants detained by Ukrainian forces.

An AFP journalist in Slavyansk said a barricade around the building where the team from the Organisation for Security and Cooperation in Europe was being held had been greatly fortified with sandbags and a machinegun.

Washington and Europe called for the immediate release of the OSCE team, which includes members from Germany, Sweden, Denmark, Poland, the Czech Republic and Bulgaria.

German Foreign Minister Frank-Walter Steinmeier has urged his Russian counterpart, Sergei Lavrov, to intervene to have the team freed, officials in Berlin said.

Russia responded it would do everything in its power to win their release.

Kiev has accused Moscow — which it sees as controlling the rebels — of seeking to trigger a “third world war” and urged Russian troops to withdraw from the border.

Russia in turn has warned it has a “right” to invade to protect Ukraine’s Russian-speaking population concentrated in the east and southeast, sparking the worst East-West confrontation since the Cold War.

 US eyes ‘tougher actions

The G-7 nations said in a joint statement they would “move swiftly to impose additional sanctions on Russia”.

“These sanctions will be coordinated and complementary, but not necessarily identical. US sanctions could come as early as Monday,” a senior US administration official said.

The Group of Seven consists of the United States, Britain, Canada, France, Germany, Italy and Japan. EU foreign ministers are also to meet soon to discuss the issue.

The United States and the European Union have already targeted Russian President Vladimir Putin’s inner circle with visa and asset freezes and imposed sanctions on a key Russian bank.

A senior White House official said the next round of sanctions could target “individuals with influence on the Russian economy, such as energy and banking”.

US Deputy National Security Advisor Ben Rhodes, speaking to reporters aboard Air Force One en route to Malaysia with President Barack Obama, spoke of “a spectrum of sanctions” that “allows us to escalate further” if the situation deteriorates.

Obama on Friday said that new sanctions against Russia were “ready to go” but had signalled they would not target key areas of the Russian economy such as the mining, energy and the financial sectors.

US officials have said those measures would only be considered if Russia sent its regular forces into Ukraine.

US Treasury Secretary Jacob Lew said sanctions were a long-term strategy.

“The goal is to hurt the Russian economy while doing the least damage necessary to the US and the global economy,” he told American public radio.

“We’ve made clear we’re prepared to take tougher actions and prepared to absorb the consequences of that if we need to.”

Tensions on the ground 

Tensions have been heightened within Ukraine, with the military pursuing a new offensive against the rebels.

Slavyansk is under siege. Several locals and insurgents there told AFP a roadblock on the town’s outskirts came under fire overnight but no-one was hurt. The rebels there have vowed they will never surrender.

The insurgents in the east have conducted their own attacks. On Friday, they blew up an army helicopter with a rocket-propelled grenade in the town of Kramatorsk, wounding the pilot.

Ukraine’s Deputy Foreign Minister Danylo Lubkivsky told reporters at the United Nations that his country would exercise restraint in its operations against pro-Russian separatists.

“The anti-terrorist operation is ongoing, but we are guided by one major idea: we would like to avoid any victims or casualties,” he said.

‘Expensive mistake’

The crisis over Ukraine has plunged relations between the West and Russia to its lowest point since the Cold War.

Russia refuses to accept the legitimacy of Kiev’s new pro-EU government, which came to power after four months of street protests forced the ouster of the Kremlin-backed president, Viktor Yanukovych.

Last month, Moscow annexed Ukraine’s peninsula of Crimea after deploying troops, sparking international outrage.

With the threat of further sanctions hanging over Russia’s already shaky economy, ratings agency Standard and Poor’s on Friday downgraded its credit rating to one notch above junk status.

Russia’s central bank reacted by raising its key interest rate.

US Secretary of State John Kerry has warned that Russia could be making “an expensive mistake” in Ukraine.

While Obama has ruled out sending US or NATO forces into Ukraine, Washington has begun deploying 600 US troops to bolster NATO’s defences in nearby eastern European states.

France also said it was sending four fighter jets to join NATO air patrols over the Baltic states.

Washington and Moscow have traded barbs over Ukraine, with Lavrov claiming the push against rebels in the east was part of a US plot to “seize” Ukraine for its own “geopolitical ambitions and not the interests of the Ukrainian people”.

The White House has urged Moscow to “choose a peaceful resolution to the crisis” by implementing the Geneva deal, which calls for “illegal armed groups” to lay down their weapons and end their occupation of public buildings.

SLAVYANSK, Ukraine — Ukraine’s military launched assaults to retake rebel-held eastern towns on Thursday in which up to five people were reported killed, a move Russian President Vladimir Putin warned would have “consequences”.

The offensive sent international tensions soaring and oil prices up on the prospect of Russia making good on its threat of a massive response in the ex-Soviet republic.

In Slavyansk, a flashpoint eastern Ukrainian town held by rebels since mid-April, armoured military vehicles drove past an abandoned roadblock in flames to take up position.

Shots were heard as a helicopter flew overhead, and the pro-Kremlin rebels ordered all civilians out of the town hall to take up defensive positions inside.

“During the clashes, up to five terrorists were eliminated,” and three checkpoints destroyed, the interior ministry said in a statement. Regional medical authorities confirmed one death and one person wounded.

Hours later, the armoured vehicles withdrew, leaving the town calm but tense.

The rebels, which the Kiev government and its Western backers believe are controlled and supported by Moscow, have been occupying around 10 towns in Ukraine’s east since mid-April.

An international accord reached in Geneva last week was meant to defuse the crisis, but was swiftly dismissed by the rebels.

A brief truce collapsed over the weekend, prompting Ukraine’s acting President Oleksandr Turchynov to order a resumption of an “anti-terrorist” offensive to flush the militants out.

Also on Thursday, Ukrainian special forces seized back control of the town hall in the southeastern port city of Mariupol with no casualties, Interior Minister Arsen Avakov said. Separatist sources confirmed the loss of the building in the port city, whose population is nearly 500,000.

And an army base in the eastern town of Artemivsk overnight repelled an attack by heavily armed rebels using machineguns and grenades, the interior and defence ministries said. One soldier was wounded.

Failure of accord 

It was the worst violence to erupt in Ukraine since the signing of the Geneva accord a week ago.

Putin called the armed offensive a crime.

“If Kiev has really begun to use the army against the country’s population... that is a very serious crime against its own people,” he said.

He warned of “consequences, including for our intergovernmental relations”.

Russia, which has an estimated 40,000 troops massed on Ukraine’s border, has already threatened to respond as it did when it invaded Georgia in 2008 if it sees its interests in Ukraine attacked.

Shortly after Putin spoke, Russia’s defence ministry announced new military “exercises” near the border in response to the Ukrainian military operations.

US President Barack Obama on Thursday accused Russia of not abiding by the Geneva deal and warned more sanctions could be imposed on Moscow within days.

“We continue to see malicious, armed men taking over buildings, harassing folks who are disagreeing with them, destabilising the region and we haven’t seen Russia step out and discouraging it,” he said Thursday during a trip to Japan.

Russia, though, claims Washington and the Ukrainian government are reneging on their responsibilities, despite Kiev vowing to give an amnesty to the rebels, protect the Russian language and decentralise power.

 Geopolitical tensions 

While Obama has ruled out sending US or NATO forces into Ukraine, Washington has begun deploying 600 US troops to boost NATO’s defences in nearby eastern European states.

France said it was also sending four fighter jets to NATO air patrols over the Baltics.

Russian Foreign Minister Sergei Lavrov on Thursday accused the United States and the European Union of trying to stage “an operation to unconstitutionally change the regime”.

“They are trying to use Ukraine as a pawn in a geopolitical game,” he said.

The Ukrainian government announced its renewed offensive against the rebels after the body of an abducted local politician who belonged to Turchynov’s party was found weighted down in a river near Slavyansk.

Volodymyr Rybak’s funeral was held Thursday in his hometown of Horlivka. His wife and friends wept before his body, which was covered in flowers, before prayers were said and it was taken for burial.

Ukraine’s acting president said he had been “brutally tortured” and blamed the rebels, while his wife said he had been stabbed multiple times.

The European Union’s top foreign policy official, Catherine Ashton, urged implementation of the Geneva accord, and expressed “grave concern” at the murder of Rybak and other violence.

Russia’s gas supplies to Ukraine — and through it, to Europe — have also become a significant source of tensions.

Putin has warned in a letter to the EU that Moscow could cut gas supplies in a month’s time if Ukraine’s bill —now estimated at some $3.5 billion (2.5 billion euros) — was not paid in full.

The energy concerns sent global oil prices up. The price of North Sea Brent oil rose seven US cents from Wednesday to $109.18 a barrel, and benchmark West Texas WTI oil rose 24 cents to $101.68.

TOKYO — US President Barack Obama assured ally Japan on Thursday that Washington was committed to its defence, including of tiny isles at the heart of a row with China, but denied he had drawn any new “red line” and urged peaceful dialogue over the islands.

His comments drew a swift response from China, which said the disputed islets were Chinese territory.

Obama also urged Japan to take “bold steps” to clinch a two-way trade pact seen as crucial to a broad regional agreement that is a central part of the US leader’s “pivot” of military, diplomatic and economic resources towards Asia and the Pacific.

US and Japanese trade negotiators failed to resolve differences in time for Obama and Prime Minister Shinzo Abe to shake hands on a deal at the summit.

The leaders reported progress, but Japan’s economics minister, Akira Amari, said later that remaining sticking points could not be resolved quickly.

Obama, on the start of a four-nation tour, is being treated to a display of pomp and ceremony meant to show that the US-Japan alliance, the main pillar of America’s security strategy in Asia, is solid at a time of rising tensions over growing Chinese assertiveness and North Korean nuclear threats.

“We don’t take a position on final sovereignty determinations with respect to Senkaku, but historically they have been administered by Japan and we do not believe that they should be subject to change unilaterally and what is a consistent part of the alliance is that the treaty covers all territories administered by Japan,” Obama said.

“This is not a new position, this is a consistent one,” he told a joint news conference after his summit with Abe, using the Japanese name for the islands that China, which also claims sovereignty over them, calls the Diaoyu.

“In our discussions, I emphasised with Prime Minister Abe the importance of resolving this issue peacefully,” Obama added.

Whilst his comments amounted to a restatement of long-standing US policy, there was symbolism in the commitment being stated explicitly by a US president in Japan.

Responding to Obama’s remarks, Chinese foreign ministry spokesman Qin Gang told a daily press briefing in Beijing that the islands belonged to China.

“The so-called US-Japan security treaty is a product of the Cold War era and it cannot be aimed at a third party and ought not to harm China’s territorial sovereignty,” he said.

“No matter what anyone says or does, it cannot change the basic reality that the Diaoyu Islands are China’s inherent territory and cannot shake the resolve and determination of the Chinese government and people to protect [our] sovereignty and maritime rights.”

International rules

Obama also said there were opportunities to work with China —which complains that his real aim is to contain its rise — but called on the Asian power to stick to international rules.

“What we’ve also emphasised, and I will continue to emphasise throughout this trip, is that all of us have responsibilities to help maintain basic rules of the world and international order, so that large countries, small countries, all have to abide by what is considered just and fair,” he said.

Some of China’s neighbours with territorial disputes with Beijing worry that Obama’s apparent inability to rein in Russia, which annexed Crimea last month, could send a message of weakness to China.

Obama told the news conference that additional sanctions were “teed up” against Russia if it does not deliver on promises in an agreement reached in Geneva last week to ease tensions in Ukraine.

Obama and Abe also agreed that their top trade aides, US Trade Representative Michael Froman and Amari, would keep trying to narrow gaps in their trade talks.

“This is not something we can reach a conclusion [on] in a short period of time,” Amari told reporters after meeting Froman again after the leaders’ summit.

Abe has touted the Trans-Pacific Partnership (TPP) as key to the “Third Arrow” of his economic programme to reinvigorate the world’s third biggest economy, along with hyper easy monetary policy and fiscal spending.

Both sides have also stressed that the TPP would have strategic implications by creating a framework for business that could entice China to play by global rules.

But the talks have been stymied by Japan’s efforts to protect politically powerful agriculture sectors such as beef, and disputes over both countries’ auto markets.

Pointing to restrictions on access to Japan’s farm and auto sectors, Obama said: “Those are all issues that people are all familiar with and at some point have to be resolved. I believe that point is now.”

Experts had said failure to reach a final deal could cast doubts on Abe’s commitment to economic reform and take the wind out of the sails of a drive for a broader TPP agreement.

“If they don’t show progress ... it will be harder to use TPP as a spur to reforms,” said Robert Feldman, a managing director at Morgan Stanley MUFG Securities in Tokyo. “It gives the anti-reform forces aid and comfort.”

The diplomatic challenge for Obama during his weeklong, four-nation regional tour is to convince Asian partners that Washington is serious about its promised strategic “pivot”, while at the same time not harming US ties with China, the world’s second biggest economy.

Obama will also travel to South Korea, Malaysia and the Philippines.

Abe — who repeatedly referred to the US president as “Barack” during their news conference — and Obama were keen to send a message of solidarity after US-Japan ties were strained by Abe’s December visit to Tokyo’s Yasukuni Shrine, seen by critics as a symbol of Japan’s past militarism.

Japan lobbied hard to get the White House to agree to an official state visit, the first by a sitting US president since Bill Clinton in 1996.

Abe is trying to soothe US concerns that his conservative push to recast Japan’s war record with a less apologetic tone is overshadowing pragmatic policies on the economy and security.