Opec set to hold oil output
OPEC ministers said they expected to keep oil output levels unchanged despite concern about demand in view of the weak economic outlook, as they started a crucial meeting in Vienna on Friday.
The 12-member Organization of Petroleum Exporting Countries (Opec), comprising nations from the Middle East, Africa and Latin America, is mindful that cutting production could raise prices and boost their incomes but that this could also boomerang by hampering fragile global recovery.
The outlook for global economic growth, and demand for oil, has been clouded by the combined impact of Chinese inflationary pressures, the long-running eurozone sovereign debt crisis and uncertainty over policy for the US economy, Opec says.
Questioned about whether the cartel would seek to roll over its daily output target of 30 million barrels per day, Angolan Oil Minister Jose Maria Botelho de Vasconcelos said that this was likely.
"We are producing about 30 million barrels (per day). I think we will take the decision to maintain the situation," he told journalists at the start of the meeting in Vienna, where the cartel is headquartered.
He also expressed satisfaction with the current price level, noting: "$100 per barrel is good."
In reality, actual output exceeds 30 million mbpd.
United Arab Emirates Energy Minister Suhail al-Mazrouei added: "There's nothing controversial (at this meeting), the levels of production being good and adequate to the market and the prices are appropriate."
Kuwait's OPEC governor Siham Abdulrazzak Razzouqi also said she expected no change, saying: "We think that the market is very stable."
"Supply and demand are in balance, prices are at a good level. Everything seems to be fine."
Even ahead of the meeting, there were indications that Opec - which pumps about 35% of global oil supplies would leave its official oil output ceiling at 30 mbpd, where it has stood since the end of 2011.
That OPEC produces above that level is partly thanks to a higher production from kingpin Saudi Arabia, which is the biggest producer in the cartel. It has also risen in recent times due to recovering production from Iraq and Libya.
"We are going to call for members to respect the ceiling," added Venezuelan Energy Minister Rafael Ramirez, signalling concern about overproduction.
Meanwhile Iran, which in the run-up to the meeting had pushed for lower output, seemed to have joined the consensus for maintaining the status quo.
"I think the current ceiling is logical, rational, reasonable," he said Friday as Opec members began their meeting.
"At the closed-door session we will recommend (to member countries) to keep maintaining their production (and) not surplus," he said.
Iran has been hit by international oil sanctions over its controversial nuclear programme which has seen it drop from second to fifth largest OPEC producer in the last two years.
Opec countries have been generally satisfied with the price of $100 per barrel, although Algeria and Qatar on Friday appeared flexible on the price.
"We dont have any price target, we are following the market," Algerian Energy Minister Youcef Yousfi told journalists.
Ahead of Opec's ministerial meeting, Brent oil prices stood at $101.60 in late morning trading in London.
Demand is being contained by weak growth in many advanced economies and by the boom of oil and gas production from shale resources in North America.
Opec's Secretary-General Abdullah El-Badri added that the cartel predicted an upswing in energy demand growth in the third and fourth quarter of this year.
However, he sounded a gloomy warning over the world economy.
"For demand growth, we have to look to the world economy. Some countries are fine, some countries are not really fine," El-Badri said.
"We have to watch out for demand ... because the United States has fiscal problems, China is also struggling with their inflation and, of course you know the problems of Europe."
Friday's gathering will also seek to identify the criteria under which members will decide their next secretary general at the next scheduled meet in December.
Record unemployment in the eurozone
Unemployment has reached a new high in the eurozone and inflation remains well below the European Central Bank's target, underscoring just how severe a challenge EU leaders face to revive the bloc's sickly economy.
Joblessness in the 17 nation currency area rose to 12.2% in April, statistics agency Eurostat said on Friday, marking a new record since the data series began in 1995.
With the eurozone also in its longest recession since its creation in 1999, consumer price inflation was far below the ECB's target of just below 2%, coming in at 1.4% in May, slightly above April's 1.2% rate.
That rise may quieten concerns about deflation, but the deepening unemployment crisis is a threat to the social fabric of the eurozone, with almost two-thirds of young Greeks unable to find work exemplifying southern Europe's threat of creating a 'lost generation'.
Economists and policy makers have expressed concern that the greatest threat to the unity of the eurozone is now social breakdown from the crisis, rather than market-driven factors.
In France, Europe's second largest economy, the number of jobless rose to a record in April, while in Italy, the unemployment rate hit its highest level in at least 36 years, with 40% of young people out of work.
Some economists expect the ECB, which meets on June 6, to act to revive the economy and go beyond another interest rate cut to consider a US-style money printing programme known as quantitative easing.
"We do not expect a strong recovery in the euro zone," said Nick Matthews, a senior economist at Nomura International in London. "It puts pressure on the ECB to deliver even more conventional and non conventional measures."
In the past, the euro zone has needed economic growth of around 1.5% to create new jobs, according to Carsten Brzeski, an economist at ING. With the Organisation for Economic Cooperation and Development forecasting this week that the euro zone economy would contract by 0.6% this year, unemployment is set to worsen long before it turns around.
"We do not see a stabilisation in unemployment before the middle of next year," said Frederik Ducrozet, an economist at Economist at Credit Agricole in Paris. "The picture in France is still deteriorating."
5.6 million young jobless
ECB President Mario Draghi, whose bold decision-making helped protect the eurozone from break-up last year with a plan to buy the bonds of governments in trouble, has so far preferred to leave the onus on euro zone governments to reform.
A majority of economists polled by Reuters do not expect the ECB to cut its deposit or main refinancing rates in the coming months, although the OECD this week called for the bank to consider quantitative easing.
The Commission, the EU's executive, told governments this week they must focus on reforms to outdated labour and pension systems to regain Europe's lost business dynamism, a move to shift focus away from debilitating budget cuts towards growth.
EU leaders meeting at the end of June in Brussels are expected to put the problem of joblessness at the forefront of their summit.
European Council President Herman Van Rompuy, who chairs the meetings, said last week youth unemployment was one of the most pressing issues for the 27-nation European Union as a whole.
Ministers from France, Italy and Germany, meeting in Paris this week, called on their counterparts to help tackle youth unemployment, with German Finance Minister Wolfgang Schaeuble describing it as a "battle for Europe's unity".
In April, 5.6 million people under 25 were unemployed in the European Union, with 3.6 million of those in the eurozone.
Even if governments take on unions and vested interests to enact reforms, they will take time to produce benefits.
The impact of the eurozone's debt and banking crises has been sapping confidence from companies and households.
Private consumption saved Germany from slipping into recession in the first three months of this year, but retail sales still fell unexpectedly in April because of the cold European winter.
Meanwhile, French consumer spending dropped again in February, falling by 0.2% after contracting in January. French household purchasing power contracted in 2012 for the first time since 1984.
N Korean farmers plant rice for bonuses
North Korean farmers knee deep in muddy paddies
across the country have a new incentive during this year's crucial rice
planting season: Possible bonuses that are part of an economic shift echoing
ally China's steps three decades ago toward embracing capitalism.
Details about the changes are emerging nearly two months after the regime unveiled dual goals of building the economy and nuclear weapons in the first concrete economic policy laid out by leader Kim Jong-un, since he took power in December 2011.
Farmers say they have begun working under the new policies, which are designed to boost production by giving managers and workers financial incentives.
Foreign analysts say the moves to spur North Korea's moribund economy suggest Pyongyang is taking cues from Beijing on how to incorporate free market ideas within its rigid socialist system.
The North's policy enshrining its provocative push to build atomic weapons as a national goal has complicated efforts to force North Korea to abandon its nuclear programme and dominated international discussion about the country.
Pyongyang's economic priorities have drawn far less attention but some experts think important reforms could be unfolding.
Lifting living standards
Impoverished North Korea suffers chronic food and power shortages and has not released economic data for decades.
South Korea's central bank estimates the North's gross national income, an indicator of the average standard of living, was $1 250 per person in 2011 compared with $23 400 for South Korea.
In the past, the North Korean state set workers' salaries. Under new measures announced on 1 April, the managers of farms, factories and other enterprises have been given leeway to set salaries and offer bonuses to workers who help drive up production.
"This is definitely significant," said John Delury, an assistant professor of Chinese studies at Yonsei University in Seoul, South Korea.
Providing material incentives and loosening central control over economic decision making are two key elements in the transition from a command economy to a market-based system, he said.
Also announced on 1 April: The reappointment of Pak Pong Ju as premier after his dismissal from the post in 2007. Pak was central to attempts at economic change more than a decade ago.
"You just wouldn't bring back Pak Pong Ju unless you were going to try readjusting economy policy. There would be no reason to do that," said Delury, calling it a strong sign of Kim Jong Un's interest in lifting living standards.
Economic reform
North Korea's policy changes find an echo in China's market reforms that have transformed it into a manufacturing powerhouse and world's second-largest economy, while also lifting several hundred million out of grinding poverty.
Beijing dismantled the centrally planned economy slowly. In the 1970s, it began allowing farmers to keep more of their harvests, giving them an incentive to grow more to sell on newly permitted free markets. Food production soared.
In the mid-'80s, the government gave state enterprises the authority to link bonuses and salaries to better performance. Those changes were mostly aimed at managers, but they cracked a communist-era preference for egalitarianism.
New rules in the early 1990s gave state enterprises full flexibility to set wages, widening the use of performance incentives. In that decade, China truly broke away from its centralised "iron rice bowl" system of guaranteed employment and state-set incomes.
Delury and others cautioned that if the North is intent on economic reform, it is likely to be a fitful process.
"We have to be careful not to say: Aha, it's all change, it's finally here," he said. "The point is, and we see this from the Chinese case, this is a process that unfolds over time and there are starts and stops, too. But this is a strong signal of a push."
‘Greater profits’
AP reported last September that farmers were notified of upcoming management changes at collective farms that would put decision-making and responsibility for crops in the hands of local officials and give farmers the right to hold onto surpluses.
"Last year, we studied reasonable economic management methods in different fields of economic work, and introduced it to some units on a trial basis," Ri Ki Song, an economist from North Korea's Academy of Social Sciences, told AP this week.
North Korea formally announced the policy, and its expansion to include factories and other enterprises, a day after holding a plenary session of the Central Committee of the Workers' Party. Rodong Sinmun, the party paper, called it a "new strategic line".
Ri, however, dismissed characterisations of the changes as reform.
What's new, he said, is allowing managers to dole out goods and cash as incentives. In addition, after meeting a state quota, managers can set their employees' salaries and offer bonuses to those who help drive up production, he said.
The main goal: to encourage "greater profits" and solve North Korea's chronic food shortage, Ri said.
‘Repay’ the state
Ri said North Koreans work hard, but the new incentives give them motivation to work even harder. "They are saying that higher salaries and shares will improve their life."
Political and military expert Ralph Cossa, president of the Pacific Forum CSIS in Hawaii, noted that North Korea has rolled back past attempts at economic reform.
"The North Koreans have played reform games before and then just sort of pulled the rug out from under it," he said. Cossa cited NGOs as saying the military is pressuring farmers to donate their portion to the army.
Last year, a farmer's wife in Sariwon, south of Pyongyang, told the AP she planned to donate any surplus harvest to the state as a token of her patriotism.
At the Tongbong farm in the eastern city of Hamhung, farmers are in the midst of a busy rice planting season after a long, cold winter.
This year, things are being managed differently, said Kim Jong Jin, deputy chairperson of the farm's managing committee.
He said the state provided the farm with the rice seedlings, which farmers are now transplanting to paddies by hand. Farmers are on smaller teams that have direct responsibility over their plots.
After the rice is harvested, farmers must "repay" the state for the seeds. At Tongbong that means giving the state about 193kg of rice as payback for every 140kg of seedlings they received.
But any surplus can be kept by the team to sell, barter or distribute - a change from past policies that required farmers to turn all harvests over to the state.
"This encourages enthusiasm for production and we get more of what's produced," Kim said.
Details about the changes are emerging nearly two months after the regime unveiled dual goals of building the economy and nuclear weapons in the first concrete economic policy laid out by leader Kim Jong-un, since he took power in December 2011.
Farmers say they have begun working under the new policies, which are designed to boost production by giving managers and workers financial incentives.
Foreign analysts say the moves to spur North Korea's moribund economy suggest Pyongyang is taking cues from Beijing on how to incorporate free market ideas within its rigid socialist system.
The North's policy enshrining its provocative push to build atomic weapons as a national goal has complicated efforts to force North Korea to abandon its nuclear programme and dominated international discussion about the country.
Pyongyang's economic priorities have drawn far less attention but some experts think important reforms could be unfolding.
Lifting living standards
Impoverished North Korea suffers chronic food and power shortages and has not released economic data for decades.
South Korea's central bank estimates the North's gross national income, an indicator of the average standard of living, was $1 250 per person in 2011 compared with $23 400 for South Korea.
In the past, the North Korean state set workers' salaries. Under new measures announced on 1 April, the managers of farms, factories and other enterprises have been given leeway to set salaries and offer bonuses to workers who help drive up production.
"This is definitely significant," said John Delury, an assistant professor of Chinese studies at Yonsei University in Seoul, South Korea.
Providing material incentives and loosening central control over economic decision making are two key elements in the transition from a command economy to a market-based system, he said.
Also announced on 1 April: The reappointment of Pak Pong Ju as premier after his dismissal from the post in 2007. Pak was central to attempts at economic change more than a decade ago.
"You just wouldn't bring back Pak Pong Ju unless you were going to try readjusting economy policy. There would be no reason to do that," said Delury, calling it a strong sign of Kim Jong Un's interest in lifting living standards.
Economic reform
North Korea's policy changes find an echo in China's market reforms that have transformed it into a manufacturing powerhouse and world's second-largest economy, while also lifting several hundred million out of grinding poverty.
Beijing dismantled the centrally planned economy slowly. In the 1970s, it began allowing farmers to keep more of their harvests, giving them an incentive to grow more to sell on newly permitted free markets. Food production soared.
In the mid-'80s, the government gave state enterprises the authority to link bonuses and salaries to better performance. Those changes were mostly aimed at managers, but they cracked a communist-era preference for egalitarianism.
New rules in the early 1990s gave state enterprises full flexibility to set wages, widening the use of performance incentives. In that decade, China truly broke away from its centralised "iron rice bowl" system of guaranteed employment and state-set incomes.
Delury and others cautioned that if the North is intent on economic reform, it is likely to be a fitful process.
"We have to be careful not to say: Aha, it's all change, it's finally here," he said. "The point is, and we see this from the Chinese case, this is a process that unfolds over time and there are starts and stops, too. But this is a strong signal of a push."
‘Greater profits’
AP reported last September that farmers were notified of upcoming management changes at collective farms that would put decision-making and responsibility for crops in the hands of local officials and give farmers the right to hold onto surpluses.
"Last year, we studied reasonable economic management methods in different fields of economic work, and introduced it to some units on a trial basis," Ri Ki Song, an economist from North Korea's Academy of Social Sciences, told AP this week.
North Korea formally announced the policy, and its expansion to include factories and other enterprises, a day after holding a plenary session of the Central Committee of the Workers' Party. Rodong Sinmun, the party paper, called it a "new strategic line".
Ri, however, dismissed characterisations of the changes as reform.
What's new, he said, is allowing managers to dole out goods and cash as incentives. In addition, after meeting a state quota, managers can set their employees' salaries and offer bonuses to those who help drive up production, he said.
The main goal: to encourage "greater profits" and solve North Korea's chronic food shortage, Ri said.
‘Repay’ the state
Ri said North Koreans work hard, but the new incentives give them motivation to work even harder. "They are saying that higher salaries and shares will improve their life."
Political and military expert Ralph Cossa, president of the Pacific Forum CSIS in Hawaii, noted that North Korea has rolled back past attempts at economic reform.
"The North Koreans have played reform games before and then just sort of pulled the rug out from under it," he said. Cossa cited NGOs as saying the military is pressuring farmers to donate their portion to the army.
Last year, a farmer's wife in Sariwon, south of Pyongyang, told the AP she planned to donate any surplus harvest to the state as a token of her patriotism.
At the Tongbong farm in the eastern city of Hamhung, farmers are in the midst of a busy rice planting season after a long, cold winter.
This year, things are being managed differently, said Kim Jong Jin, deputy chairperson of the farm's managing committee.
He said the state provided the farm with the rice seedlings, which farmers are now transplanting to paddies by hand. Farmers are on smaller teams that have direct responsibility over their plots.
After the rice is harvested, farmers must "repay" the state for the seeds. At Tongbong that means giving the state about 193kg of rice as payback for every 140kg of seedlings they received.
But any surplus can be kept by the team to sell, barter or distribute - a change from past policies that required farmers to turn all harvests over to the state.
"This encourages enthusiasm for production and we get more of what's produced," Kim said.
Police clash with Istanbul protesters
Riot police fired tear gas at hundreds of
demonstrators on Friday, injuring at least a dozen people, in a bid to break up
a four-day protest against a major construction project in Istanbul's iconic Taksim Square.
Several of the wounded were left lying on the ground unconscious after
they were hit with large quantities of tear gas and pepper spray, while two
people were hospitalised with injuries to the head, an AFP photographer witnessed.
Some protesters were also hurt when a scaffolding collapsed as they tried to escape the police intervention on the square.
Construction had began in November to pedestrianise the zone surrounding the famous square, a traditional gathering point for rallies and protests as well as a popular tourist destination.
The controversial project is aimed at easing the chronic congestion in the roads around the square.
Demonstrators have been trying to prevent workers from razing Taksim Excursion Park, which lies across from the square's centrepiece, the Ataturk monument. In place of the park, a shopping mall is to be built.
Critics say the project would turn the square into yet another soulless concrete commercial zone aimed at making money while driving away residents who use it as a meeting point.
Taksim Square has for decades been the rallying point for millions of Istanbul residents, as well as the political stage for demonstrators who pour in on a daily basis to make their views on different causes heard.
Notes to Obama, mayor had gun threats
A suspicious letter mailed to the White House and intercepted this week was similar to two threatening, poison-laced letters on the gun law debate sent to New York Mayor Michael Bloomberg, one of the nation's most potent gun-control advocates, officials said on Thursday.
Yet another letter became known publicly on Thursday, one tainted with the poison ricin and mailed to President Barack Obama from Spokane, Washington, the FBI said. Authorities have arrested a man in Spokane in connection with that letter, which was intercepted on May 22.
The Secret Service said the White House-bound letter similar to the ones Bloomberg was sent was intercepted by a White House mail screening facility. Two similar letters postmarked in Louisiana and sent to Bloomberg in New York and his gun control group in Washington contained traces of the deadly poison ricin.
It wasn't immediately clear whether the letter sent to Obama contained ricin. It was turned over to the FBI's Joint Terrorism Task Force for testing and investigation.
The two Bloomberg letters, opened Friday in New York and Sunday in Washington, contained an oily pinkish-orange substance.
New York Police Department Commissioner Raymond Kelly said Thursday the same machine or computer had produced the two letters to Bloomberg and the similar one to Obama and that they may be identical. He referred specific questions to the FBI.
The FBI said in a statement that field tests on the letters were consistent with the presence of a biological agent, and the letters were turned over to an accredited laboratory for the kind of thorough analysis that is needed to verify a tentative finding. "More letters may be received," the statement said, without elaboration.
The body of the letter mailed to New York was addressed to "you" and referenced the gun control debate. Kelly said the unsigned letter says, in so many words: "Anyone who comes for my guns will be shot in the face." He refused to quote directly from the letter, saying he didn't want to do the author's bidding.
Second letter
Bloomberg has emerged as one of the country's most important gun-control advocates, able to press his case with both his public position and his private money.
The New York letter was opened at the city's mail facility in Manhattan in a biochemical containment box, which is a part of the screening process for mayor's office mail.
"In terms of the processes and procedures that are in place now we think they worked," Kelly said. "This is sort of an effect of the post-9/11 world that we live in that these checks and facilities are in place and the system worked."
The second letter was opened on Sunday by Mark Glaze, director of Mayors Against Illegal Guns, the Washington-based nonprofit Bloomberg started.
The letter Glaze opened tested positive for ricin initially. The other letter to Bloomberg at first tested negative but tested positive at a retest Wednesday.
The postal workers union, citing information it got in a Postal Service briefing, said the letters bore a Shreveport, Louisiana, postmark. Kelly would not comment on the origin of the letter.
Louisiana State Police spokesperson Julie Lewis said state authorities have deferred to the FBI and have not opened an investigation. The Shreveport postal center handles mail from Louisiana, Texas and Arkansas, so the letter could have come from any of those states, Lewis said.
The people who initially came into contact with the letters showed no symptoms of exposure to the poison, but three officers who later examined the New York letter experienced minor symptoms that have since abated, police said. The mayor visited the mailroom on Thursday but made no public comments on the topic.
Background checks
On Wednesday, he said he didn't know why they were sent.
One of the letters "obviously referred to our anti-gun efforts, but there's 12 000 people that are going to get killed this year with guns and 19 000 that are going to commit suicide with guns, and we're not going to walk away from those efforts", said Bloomberg, adding that he didn't feel threatened.
According to the federal Centres for Disease Control and Prevention, ricin is a poison found naturally in castor beans. Symptoms can include difficulty breathing, vomiting and redness on the skin depending on how the affected person comes into contact with the poison.
The letters were the latest in a string of toxin-laced missives, but authorities would not say whether the letters to Bloomberg and Obama were believed to be linked to any other recent case.
In Washington state, a 37-year-old was charged last week with threatening to kill a federal judge in a letter that contained ricin. On Thursday, the FBI said a suspicious letter containing ricin was mailed to Obama from Spokane on the same day similar ricin-tainted letters were mailed to the judge and to a post office. A fourth letter, sent to nearby Fairchild Air Force Base, continues to undergo testing, officials said.
About a month earlier, letters containing the substance were addressed to Obama, a US senator and a Mississippi judge. One of the letters postmarked in Memphis, Tennessee, was traced back to Tupelo, Mississippi, and a Mississippi man was arrested.
Bloomberg and Boston Mayor Thomas Menino founded Mayors Against Illegal Guns, which now counts more than 700 mayors nationwide as members.
It lobbies federal and state lawmakers, and it aired a spate of television ads this year urging Congress to expand background checks and pass other gun-control measures after the school shooting in Newtown, Connecticut.
The background check proposal failed in a Senate vote in April, and other measures gun-control advocates wanted including a ban on sales of military-style assault weapons have stalled.
Separately, Bloomberg also has made political donations to candidates who share his desire for tougher gun restrictions. His super PAC, Independence USA, put $2.2m into a Democratic primary this winter for a congressional seat in Illinois, for example. Bloomberg's choice, former state lawmaker Robin Kelly, won.
Hagel to discuss cyberthreat with Chinese
The United States must develop "rules of the road" with China and other countries
to mitigate cyber threats, Pentagon chief Chuck Hagel said on Thursday.
The defence secretary spoke after a Pentagon report found that Chinese hackers have gained access to secret designs for a slew of sophisticated US weapons programs, possibly jeopardising the American military's technological edge.
Officials say the breaches described in the Defence Science Board paper were part of a broad Chinese campaign of espionage against top US defence contractors and government agencies.
"The United States knows where many of these incursions come from," Hagel told reporters on his plane as he travelled to the annual Shangri-La Dialogue, an international security conference in Singapore.
"It's pretty hard to prove that they are directed by any specific enemy but we can tell where they come from and we've got to be honest about that."
Cyber security is set to be discussed for the first time at a meeting of Nato defence ministers next week.
"We've got to find ways, working with the Chinese, working with everybody, [to develop] rules of the road, some international understandings," Hagel said.
Relationship
The Pentagon chief said Washington would press Beijing using both public diplomacy and private talks.
"I think it's always important when dealing with other nations that you use a very significant range of options," he added.
"I've rarely seen that public engagement resolves the problem but it's important that people state where they are on these issues."
During his stay in Singapore through Monday, Hagel plans to hold multiple bilateral talks with his Asian counterparts.
He pointed to an "evolving" military-to-military relationship with China.
The top US uniformed military officer, chairperson of the joint chiefs of staff General Martin Dempsey visited Beijing in April and Hagel has invited his Chinese counterpart Chang Wanquan to Washington in August.
President Barack Obama is set to meet with new Chinese leader Xi Jingping next week in California.
The defence secretary spoke after a Pentagon report found that Chinese hackers have gained access to secret designs for a slew of sophisticated US weapons programs, possibly jeopardising the American military's technological edge.
Officials say the breaches described in the Defence Science Board paper were part of a broad Chinese campaign of espionage against top US defence contractors and government agencies.
"The United States knows where many of these incursions come from," Hagel told reporters on his plane as he travelled to the annual Shangri-La Dialogue, an international security conference in Singapore.
"It's pretty hard to prove that they are directed by any specific enemy but we can tell where they come from and we've got to be honest about that."
Cyber security is set to be discussed for the first time at a meeting of Nato defence ministers next week.
"We've got to find ways, working with the Chinese, working with everybody, [to develop] rules of the road, some international understandings," Hagel said.
Relationship
The Pentagon chief said Washington would press Beijing using both public diplomacy and private talks.
"I think it's always important when dealing with other nations that you use a very significant range of options," he added.
"I've rarely seen that public engagement resolves the problem but it's important that people state where they are on these issues."
During his stay in Singapore through Monday, Hagel plans to hold multiple bilateral talks with his Asian counterparts.
He pointed to an "evolving" military-to-military relationship with China.
The top US uniformed military officer, chairperson of the joint chiefs of staff General Martin Dempsey visited Beijing in April and Hagel has invited his Chinese counterpart Chang Wanquan to Washington in August.
President Barack Obama is set to meet with new Chinese leader Xi Jingping next week in California.
