N Korea quits liaison office with S Korea

Protesters hold signs during a rally demanding the denuclearization of the Korean Peninsula and a peace treaty near the US embassy in Seoul South Korea

It was not clear whether North Korea's withdrawal of staff would be temporary or permanent.

The sanctions come just three weeks after a second meeting between Donald Trump and North Korean leader Kim Jong-un broke down over conflicting demands by North Korea for relief from sanctions and from the U.S. side for Pyongyang to give up its nuclear weapons.

Seoul's unification ministry said Friday the South received communication from the North the decision came from a "superior authority", Yonhap reported.

It has expressed its regret at the decision and is urging staff from the North to return as soon as possible.

The office was a symbol of the ongoing peace process between the two countries, and the North's withdrawal could imply the deterioration of the relationship.

The inter-Korean liaison office in Gaeseong, North Korea.

The US Treasury Department also issued an updated advisory that listed 67 vessels that it said had engaged in illicit transfers of refined petroleum with North Korean tankers or were believed to have exported North Korean coal. But experts saw a pattern in the North lashing out against the South when its crucial strategic position with Washington is in jeopardy.

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Pyongyang said it would notify Seoul regarding "further practical matters in the future".

There were no new US sanctions on North Korea announced on Friday but on Thursday the United States blacklisted two Chinese shipping companies that it said helped North Korea evade sanctions over its nuclear weapons program.

There have also been reports of renewed activity at a North Korean nuclear test site, which have been condemned by Donald Trump.

Reuters was unable to locate contact details for either of the Chinese companies to seek comment.

The move comes after the United States placed new sanctions on Chinese companies for conducting business with Pyongyang.

They added that Pyongyang "will not mind the South remaining in the office", according to South Korea's Unification Ministry.

U.S. -North Korean engagement has appeared to be in limbo since the February 27-28 summit, despite U.S. Secretary of State Mike Pompeo saying on March 4 he was hopeful he could send a team to North Korea "in the next couple of weeks". North Korean leader Kim and South Korean President Moon Jae-in reached an agreement to open the office after their historic summit meeting in April. But Ms Choe said that the North had only asked for five key economic sanctions to be lifted. Chun mentioned the departing North Korean diplomatic officials took documents with them but left most of their equipment behind. Washington said shipping giants Dalian Haibo International Freight and Liaoning Danxing International Forwarding were now banned from dealing with United States companies and confirmed any USA assets held by the companies would be frozen.

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