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New Zealand's business confidence continued to worsen in the second quarter of this year as companies grappled with increased costs and higher interest rates, a private think tank said on Tuesday.

A net 65% of firms surveyed expected general business conditions to deteriorate compared with 40% pessimism in the previous quarter, the New Zealand Institute of Economic Research's (NZIER) quarterly survey of business opinion (QSBO) showed.

It added that business confidence is now at its lowest level since the first quarter of 2020 when the COVID-19 pandemic was declared.

On a seasonally adjusted basis, 62% expected business conditions to worsen, versus 34% pessimism recorded in the previous period. The survey's measure of capacity utilisation fell to 93.4%, from the previous quarter's 97.1%.

The services and building sectors were the most downbeat in the June quarter. The building sector faces acute capacity constraints, and the services sector expects weaker demand as interest rates move higher, NZIER said in its report.

A net 78% reported increased costs in the June quarter, it said. Despite the shakier outlook for the New Zealand economy, inflation pressures have continued to intensify, the report said. (Reuters)

North Korea appears to have released water from a dam near its border with South Korea, prompting vacationers in the neighbouring country to evacuate over rising water levels on the Imjin River, officials said on Tuesday.

The water level at a bridge at the river in the South's border county of Yeoncheon surpassed 1 metre on Monday afternoon, requiring visitors on the riverbank to evacuate, government data showed.

"North Korea appears to have released water from its Hwanggang dam," an official at South Korea's unification ministry handling inter-Korean affairs told Reuters.

The Yeoncheon county said it sent alarm messages to nearby residents and issued warnings to move to a safe area.

It was not immediately clear how many people had to leave after the suspected water release.

"The water level is now decreasing after hovering over 1.6 metres," a Yeoncheon county official said.

North Korea has been stepping up efforts to prevent flood damage from recent heavy rains.

South Korea has repeatedly urged the North to give notice before releasing water from the dam, as the river flows through Yeoncheon, but Pyongyang has remained unresponsive.

Release of water from the dam in 2009 resulted in flooding downstream that killed six South Koreans. (Reuters)

The United Nations' food agency said it had received $17 million from Japan to address grain storage problems in Ukraine and increase its exports as global food prices remain near record levels amid war in the country.

The funds would help Ukraine, the world's fourth largest grains exporter, store produce from the current July-August harvest in plastic sleeves and modular storage containers, the U.N. Food and Agriculture Organisation (FAO) said.

Ukraine's Black Sea ports have stopped operating since the Feb. 24 Russian invasion, halting its maritime exports and leaving its silos full with grain. Food prices have soared in response, triggering a global food crisis and protests in developing countries.

"Ukraine's farmers are feeding themselves and millions more people around the world," said Rein Paulsen, Director of the FAO's emergencies and resilience office.

"Ensuring they can continue production, safely store and access alternative markets is vital to strengthen food security within Ukraine and ensure other import-dependent countries have sufficient supply of grain at a manageable cost," he added.

The FAO said Ukraine still had 18 million tonnes of last year’s grains and oilseeds harvest stuck in storage, and the country was expecting to harvest another 60 million tonnes in the current season.

Around 30% of its granaries were full with last season's harvest however, the FAO said.

Ukraine, which shipped 44.7 million tonnes of grains in 2020/21, is trying to export its crop via road, river and rail, but logistics difficulties limit volumes to a maximum of around 2 million tonnes a month.

The FAO said it would also use its new funds to help Ukraine operationalise these alternative grains export routes. (Reuters)

 China's ambassador touted trade and investment plans for Afghanistan on Tuesday, a public endorsement for doing business in the Taliban-controlled country after an earthquake drew attention to the humanitarian consequences of Western sanctions.

At a rare press conference alongside the Taliban administration's acting minister for disaster management, Ambassador Wang Yu announced $8 million in aid for relief from the June 22 earthquake that killed more than 1,000 people.

"Besides emergency humanitarian aid, after the political changes last year and after the earthquake, we also have long-term economic reconstruction plans," he said. The priority would be trade, followed by investment, as well as agriculture.

No country has formally recognised the Taliban, who seized power last year after the United States and its allies abruptly withdrew troops following 20 years of war.

Western countries say the sanctions, which include freezing billions of dollars in Afghan reserves, can be lifted only if the militants meet conditions such as lifting restrictions on participation in public life for women and girls. Some aid agencies complained that sanctions curtailed their ability to assist after last month's earthquake.

China, which shares a remote border with Afghanistan and derives influence among its neighbours from its huge "Belt and Road" investment initiative, has consistently called for sanctions to be lifted.

The ambassador said negotiations were going on for two major mining projects, including Mes Aynak, a copper mine in southern Afghanistan that a Chinese state-owned company has rights to under an arrangement brokered with the previous Afghan government. Afghanistan's largely untapped mineral reserves include large deposits of iron ore and copper.

Taliban administration officials, including the group's Supreme Leader in a speech at a gathering last week, have said the country needs to become less dependent on aid and encourage business.

Speaking of Afghan reserves frozen in Western banks, Wang said: "China always thinks that money belongs to the Afghan people ... China has always called on the international community...for the release of the funds." (Reuters)