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Brazil's Lula Criticizes US Dollar and IMF during China Visit

Brazilian President Lula da Silva speaks during the inauguration of Dilma Rousseff as the head of the New Development Bank in Shanghai, on April 13, 2023. Ricardo Stuckert, Reuters
Brazilian President Lula da Silva speaks during the inauguration of Dilma Rousseff as the head of the New Development Bank in Shanghai, on April 13, 2023. Ricardo Stuckert, Reuters
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Brazil's Lula Criticizes US Dollar and IMF during China Visit

Brazilian President Lula da Silva speaks during the inauguration of Dilma Rousseff as the head of the New Development Bank in Shanghai, on April 13, 2023. Ricardo Stuckert, Reuters
Brazilian President Lula da Silva speaks during the inauguration of Dilma Rousseff as the head of the New Development Bank in Shanghai, on April 13, 2023. Ricardo Stuckert, Reuters

The two countries have recently announced a deal to trade in their own currencies, dropping the dollar as an intermediary. Lula also criticized the IMF, accusing it of 'asphyxiating' the economy of certain countries.

Brazilian President Luiz Inacio Lula da Silva criticized the outsize role of the US dollar in the world economy and lashed out at the IMF on Thursday during an official visit to China, AFP said.

The veteran leftist, whose government recently announced a deal with Beijing to trade in their own currencies – ditching the dollar as an intermediary – is in China to boost ties with his country's top trading partner and spread his message that "Brazil is back" as a key player on the global stage.

"Why should every country have to be tied to the dollar for trade?... Who decided the dollar would be the (world's) currency?" Lula said in Shanghai at a ceremony to inaugurate his political ally Dilma Rousseff as president of the development bank set up by the BRICS nations (Brazil, Russia, India, China and South Africa).

"Why can't a bank like the BRICS bank have a currency to finance trade between Brazil and China, between Brazil and other BRICS countries?... Today, countries have to chase after dollars to export, when they could be exporting in their own currencies."

Lula also had strong words for the International Monetary Fund, alluding to accusations the IMF forces overly harsh spending cuts on cash-strapped countries like Brazil's neighbor Argentina in exchange for bailout loans.

"No bank should be asphyxiating countries' economies the way the IMF is doing now with Argentina, or the way they did with Brazil for a long time and every third-world country," he said. "No leader can work with a knife to their throat because (their country) owes money."

'Brazil is back!'
Lula, who took office in January, is looking to reposition Brazil as a global go-between and deal broker, seeking friendly ties across the board after four years of relative isolation under his far-right predecessor, Jair Bolsonaro.

He is due to meet with Chinese counterpart Xi Jinping in Beijing on Friday, and also visited US President Joe Biden in February.

"Brazil is back!" Lula promised in Shanghai, where he arrived on Wednesday night. "The time when Brazil was absent from major world decisions is in the past. We are back on the international stage, after an inexplicable absence."

One of the main topics on the agenda, when Lula and Xi meet on Friday, is expected to be the Ukraine war. Both China and Brazil have positioned themselves as mediators in the conflict, despite Western concerns that they are overly cozy with Russian President Vladimir Putin. Both countries have refused to join Western nations in imposing sanctions on Russia for its invasion.

Trade ties
The Shanghai leg of Lula's trip highlighted another key goal of the visit –- deepening trade ties between the Asian giant and Latin America's biggest economy. China is Brazil's biggest export market, buying tens of billions of dollars' worth of soybeans, beef and iron ore.

Under the currency deal announced in March, Brazil and China have named two banks – one in each country – to conduct their massive trade and financial transactions by directly exchanging yuan for reais and vice versa, instead of going through the dollar. China has similar deals with Russia, Pakistan and several other countries.

After Rousseff's inauguration, Lula visited a research center run by Chinese telecom giant Huawei. Huawei's chair walked him through an exhibition showcasing the company's extensive presence in Brazil – a contrast with the United States, where companies are effectively barred from doing business with the firm.

Lula also met the head of China's biggest electric carmaker, BYD, which said in October that it planned to set up a vehicle manufacturing plant in northern Brazil's Bahia after Ford Motors closed its factory there. The company is already making electric buses and cars in Brazil for the Latin American market.

Lula, who previously led Brazil from 2003 to 2010, is seeking to smooth relations with China, after ties deteriorated under Bolsonaro.

The 77-year-old president was initially scheduled to make the trip in late March, but had to postpone it after coming down with pneumonia.

He is travelling with a large delegation of about 40 high-level officials, including cabinet ministers, governors and members of Congress.

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Satellite Images Suggest North Korea Expanding Missile Plant, Researchers Say

A satellite image shows a suspected missile assembly building under construction (lower center of photo) at the "February 11 Plant" near Hamhung, North Korea in this handout image obtained by Reuters on November 20, 2024. (Planet Labs PBC/Handout via Reuters)
A satellite image shows a suspected missile assembly building under construction (lower center of photo) at the "February 11 Plant" near Hamhung, North Korea in this handout image obtained by Reuters on November 20, 2024. (Planet Labs PBC/Handout via Reuters)
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Satellite Images Suggest North Korea Expanding Missile Plant, Researchers Say

A satellite image shows a suspected missile assembly building under construction (lower center of photo) at the "February 11 Plant" near Hamhung, North Korea in this handout image obtained by Reuters on November 20, 2024. (Planet Labs PBC/Handout via Reuters)
A satellite image shows a suspected missile assembly building under construction (lower center of photo) at the "February 11 Plant" near Hamhung, North Korea in this handout image obtained by Reuters on November 20, 2024. (Planet Labs PBC/Handout via Reuters)

North Korea is expanding a key weapons manufacturing complex that assembles a type of short-range missile used by Russia in Ukraine, researchers at a US-based think tank have concluded, based on satellite images.

The facility, known as the February 11 plant, is part of the Ryongsong Machine Complex in Hamhung, North Korea's second-largest city, on the country's east coast.

Sam Lair, a research associate at the James Martin Center for Nonproliferation Studies (CNS), located at the Middlebury Institute of International Studies at Monterey, said the plant was the only one known to produce the Hwasong-11 class of solid-fuel ballistic missiles. Ukrainian officials say these munitions - known as the KN-23 in the West - have been used by Russian forces in their assault on Ukraine.

The expansion of the complex has not been previously reported.

Both Moscow and Pyongyang have denied that North Korea has transferred weapons for Russia to use against Ukraine, which it invaded in February 2022. Russia and North Korea signed a mutual defense treaty at a summit in June and have pledged to boost their military ties.

North Korea's mission to the United Nations did not respond to a request for comment for this story.

The satellite images, taken in early October by the commercial satellite firm Planet Labs, show what appears to be an additional assembly building under construction as well as a new housing facility, likely intended for workers, according to the analysis by researchers at CNS.

It also appears that Pyongyang is improving the entrances for some of the underground facilities at the complex.

A disused bridge crane that was in front of a tunnel entrance, blocking easy access, was removed, suggesting they might be placing an emphasis on that part of the facility, Lair said.

"We see this as a suggestion that they're massively increasing, or they're trying to significantly increase, the throughput of this factory," Lair said.

The new assembly building is about 60 to 70 percent the size of the previous building used to assemble missiles.

In 2023, state media published images, which Reuters has reviewed, showing North Korean leader Kim Jong Un walking through new buildings at the complex in Hamhung, where workers were assembling tail kits and nose cones for what appeared to be the KN-23, according to analysts.

In the past, publicly released videos from North Korean state media show that the complex has produced everything from tank wheels to the casings for rocket motors, Lair said.

LOW-FLYING MISSILES

The KN-23 was first tested in May 2019, and is designed to evade missile defenses by flying on a lower, "depressed" trajectory, experts have told Reuters, making them potentially useful for Russia as it seeks ways to penetrate Ukraine's air defenses.

Russia has fired thousands of missiles since the invasion. Leaning on North Korea for additional supplies could ease the strain on its own production facilities, Lair said.

North Korea's state news agency KCNA has reported that construction is underway at the Ryongsong Machine Complex.

This month, KCNA said the facility "is pushing ahead with the projects for attaining the goal for modernization planned for this year." The work includes rebuilding production facilities as well as assembling and installing equipment at machine workshops and a steel casting workshop, it said.

Researchers at SI Analytics, a South Korean satellite imagery firm that uses AI technology to scour images, also confirmed the new construction at the February 11 plant, saying in a report on Monday that some of the construction near the loading area would likely be used to conceal the future operations of the factory from satellites.

"Considering the presence of numerous construction materials, vehicles, and open-top freight cars loaded with materials around the site, the construction appears to be progressing rapidly," the firm said. The report said the facility was used to produce ballistic missiles, without naming the KN-23.

Michael Duitsman, also a research associate at CNS, said it was possible that the new construction revealed in the satellite images could be a storage facility, but he believed it was more likely a new assembly building.

North Korean missiles account for a fraction of Russia's strikes during its war on Ukraine, but their alleged use has caused alarm in Seoul and Washington because it suggests an end of nearly two-decade consensus among UN Security Council permanent members on preventing Pyongyang from expanding its ballistic missile programs.

SI Analytics said on Monday it had also identified new construction at the nearby February 8 Vinalon Complex, which is believed to produce fuel for ballistic missiles. The construction may be aimed at boosting production of solid propellants or UDMH, an important liquid rocket engine fuel, the report said.

Joseph Dempsey, a military analyst with London's International Institute for Strategic Studies, said that North Korea's expansion of short-range ballistic missile facilities would likely be motivated mainly by a desire to boost the country's own arsenal.

He said it was unclear to what extent Pyongyang may have expanded production capacity to meet the demands of its new cooperation with Moscow.

More than 10,000 North Korean troops have been deployed to the Russian region of Kursk, where Ukraine launched a major cross-border incursion in August, according to Washington, Kyiv and Seoul.

The troops will fight as part of Russia's airborne unit and marines, with some already participating in battles in the Ukraine war, a South Korean lawmaker who sits on the parliamentary intelligence committee said on Wednesday.

Russia has not denied the involvement of North Korean troops in the war, which it has been waging in Ukraine since launching a full-scale invasion in February 2022.