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North Korean conflict

August 22, 2011

North Korea has seized a resort jointly run with the South in a move likely to ramp up tensions even as Pyongyang seeks to ease relations with the wider world.

North Korean leader Kim Jong Il has been seeking aid for his impoverished country
North Korean leader Kim Jong Il has been seeking aid for his impoverished countryImage: dapd

According to South Korean Yonhap News Agency, the assets to be liquidated are worth an estimated 300 billion won (284 million dollars). The 14 remaining South Korean staff at the resort have been given 72 hours to leave after Monday's announcement.

"All assets owned by South Korean companies in Mount Kumgang resort are banned from being taken out as of August 21," the official North Korean Central News Agency reported. "We consider that the South has completely given up all rights on properties owned by South Korean companies and now start legal disposal of them," it added.

Mount Kumgang was developed by the South's Hyundai Asan. It was opened to the public in 1998 and has been a vital source of hard currency for Pyongyang, attracting over a million South Korean visitors and earning the impoverished North tens of millions of dollars a year. It was closed in 2008 after a North Korean soldier shot a female South Korean tourist there.

Mount Kumgang was one of the few places open for tourism in North KoreaImage: AP

Confrontation

Since the 2008 shooting, Seoul has demanded an investigation by the North, an apology and assurance it will not happen again. Pyongyang has refused and has threatened to end South Korean companies' exclusive rights to run tours in a bid to force the South to back down.

The North said in June it had revised a law overseeing the resort, effectively ending Hyundai Asan's contract to run all cross-border tours to the resort. South Korea has vowed to safeguard the property rights of its firms. It has said that the North would be held accountable for all consequences resulting from its disposal of the assets, estimated to be worth about 285 million US dollars.

Seoul called Pyongyang's latest move "regrettable" and vowed to take "all possible measures including legal and diplomatic actions" to reverse the decision.

Looking to improve ties

The seizure of the resort, once a symbol of cooperation between the Pyongyang and Seoul, comes with the isolated North looking to reach out to the global community for aid as it struggles with famine and deadly floods. Senior United States and North Korean officials held talks in New York in July, a week after chief nuclear negotiators from the two Koreas unexpectedly met in Bali.

North Korean diplomats return the United States for talks on July 28, 2011Image: dapd

Currently, North Korean leader Kim Jong Il is headed for a rare summit with Russian President Dmitry Medvedev in Ulan-Ude later this week.

Use of force

Past talks to resume tourism between the two Koreas have produced little as cross-border ties turned icy after Seoul accused Pyongyang of torpedoing its warship, leading to the loss of 46 lives in March 2010. The North angrily denied the charge but went on to shell a border island that left four South Koreans dead and sparked brief fears of a possible war in November 2010, prompting Seoul to cut most trades and aid.

Author: Sarah Berning (AFP, dpa, Reuters)
Editor: Manasi Gopalakrishnan

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