The government said Thursday that North Korea will face "grave measures," if it fails to respond to the proposal for working-level talks on the Gaesong Industrial Complex by the close of today.
The ultimatum came after Pyongyang stopped all access to Gaesong from the South on April 3, citing provocations by Seoul against its sovereign dignity, and subsequently withdrew all 53,000 North Korean workers employed by the 123 South Korean companies operating there on April 9.
"We are making an official offer to North Korea to discuss ways of normalizing operations at the Gaeseong Industrial Complex and want to hear their position on the matter before noon Friday," said Ministry of Unification spokesman Kim Hyung-suk.
"There is no change in our government's firm position that Gaeseong should be maintained and developed, but, if North Korea does not respond by the deadline, the South will have no choice but to take grave measures."
Kim did not say what these would be, but it is assumed that a complete pullout from the North Korean border city may be one of the possible options. The complex has served as a valued source of hard currency for the impoverished North.
Turnover in 2012 was reported to be $469.5 million, with accumulated turnover since 2004 standing at $1.98 billion.
The spokesman also said that the North turned down a request, Wednesday, for informal talks between South Korean representatives at the Gaeseong Industrial District Management Committee and the North's General Bureau for Special Zone Development Guidance that manages the industrial zone.
The proposal for talks came two weeks after President Park Geun-hye and Unification Minister Ryu Kil-jae offered inter-Korean dialogue on April 11.
"Compared with the previous proposal, this one is working-group talks, which are more progressive," Kim said.
In addition, policymakers announced a pan-governmental action to help companies with factories in the border town deal with liquidity problems caused by lost production and the cancellation of orders.
Despite the ultimatum, North Korea watchers say the chances of the North responding to the proposal is very slim.
"North Korea is likely to turn down the offer," said Yoo Ho-yeol, a professor of the North Korean Studies Department at Korea University.
"Even if the North sends a delegation, it is highly likely to demand an apology for all anti-Pyongyang acts in the South before starting talks for the normalization of the complex."
With the ongoing stoppage at the industrial zone, there is growing speculation that the complex is likely to follow in the footsteps of the Mount Geumgang resort on the North's east coast, which was closed after a female South Korean tourist was shot dead in 2008.
Pyongyang has since tried to find a new operator for the resort.
The joint industrial park, established in 2004, is the last remaining symbol of inter-Korean economic cooperation. Currently, there are 176 South Koreans still in Gaesong, far lower than the usual 850.