UN, US pondering North Korea response

SEOUL: The impact of North Korea launching an artillery attack on Yeonpyeong island in the Yellow Sea is being acutely felt both economically, with Asian markets falling sharply Wednesday, and politically as an appropriate response is sought by the international community.

Following a White House meeting of high-powered "principals" on Tuesday President Barack Obama said in a television interview that the international community must recognize that North Korea is "a serious and ongoing threat that has to be dealt with."

The United States has confirmed that it is too early to consider a military response but left nobody in any doubt that Obama is furious at the attack which was ostensibly launched to warn South Korea to halt military drills in the area.

The South returned fire, scrambled F-16 fighters, placed the country on its highest alert outside of a war and warned the North that there would be severe consequences if this continued. The North responded by threatening to continue launching strikes against South Korea if it violates their disputed sea border "even 0.001 millimeter".

On Wednesday the US-led United Nations Command said it has called for talks with Pyongyang in order to ease tensions.

South Korea's stock market opened sharply lower with the benchmark KOSPI index down 2.33 percent or 45.02 points at 1,883.92. The won opened at a two-month low of 1,175 to the dollar on concerns about North Korea.

Analysts are suggesting that the attack might be a means by which Kim Jong-un, son of the current leader Kim Jong-Il, could deliberately destabilise the region in order to mobilise the military and consolidate his power.