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Finger-pointing ensues after North-South flareup in disputed waters. The North bulks up on plutonium. The South expedites plans to build an administrative capital. A poison-pill clause is proposed to protect companies from hostile takeovers. Household incomes fall. And parents pray while students take the college entrance exam.
Top News: North and South Korean vessels exchanged fire in disputed waters west of the Korean Peninsula — the first naval skirmish in seven years — after the North crossed an UN-designated maritime border. One casualty and two injured were reported, and the North Korean ship, which the South Korean military said opened fire on its patrol boat, retreated engulfed in flames. >The North blamed the South for the scuffle, and said it will take “merciless military measures” to protect itself. The North does not recognize the Northern Limit Line that divides the two countries’ waters and has repeatedly used the matter to provoke the South.
Analysts, however, believe North Korea is trying to draw U.S. attention from South Korea. By displaying military force in the region, the North wants to remind Washington that the U.S. needs to negotiate a peace treaty if it wants North Korea to give up its nuclear arms program, some experts said. Other analysts said it was a ploy to win more food aid from the South.
North Korea's state-run news agency announced the country has produced more arms-grade plutonium at its Yongbyon nuclear plant by reprocessing 8,000 spent fuel rods. The reprocessing would give North Korea more material to build atomic weapons. The announcement was meant to put pressure on the U.S. before nuclear disarmament talks, one expert said.
The South’s plans to build an administrative capital named Sejong City is gaining speed as Prime Minister Chung Un-chan announced he will expedite unveiling details of the revised layout. Initiated by the previous Roh Moo-hyun administration, the $19-billion endeavor was originally envisioned as an administrative hub in South Chungcheon. But the current administration, which says the second capital should be a self-sufficient city that includes science and medical research centers, is drafting alternative plans. The new road map will be presented in January and the project is expected to be completed in 2011.
Money: South Korea is considering introducing a poison pill scheme to protect companies from hostile takeovers so they can put more money into investments rather than into protecting company ownership. In a statement, the Justice Ministry said the country had made hostile takeovers easier by removing the limits on foreign stock investment while failing to enact provisions to protect domestic companies. The country's M&A laws were relaxed following the Asian Financial Crisis in the 1990s to encourage foreign investment. The ministry is holding a public hearing to discuss the introduction of the bill, which would allow shareholders to buy new shares quickly when a company is facing an unsolicited bid.
Household incomes fell 1.4 percent in the third quarter compared to a year ago, according to Statistics Korea. It marks the second decrease in a row, although household spending rose because of government stimulus.
Elsewhere: Students across the country sat for the annual one-day college entrance examination that will determine which university they attend. On exam day, government offices and large companies delayed opening for an hour to ensure applicants arrived at their test sites on time. Many parents spent the day praying at churches, temples and in front of school gates.
South Korea ranks eighth in the Asia-Pacific region for mobile phone subscription rates, with 9 in 10 people owning a cell phone, according to the International Telecommunication Union. Since 2002, cell phone ownership has jumped from 68 to 90 percent.