By Kim Young-jin
North Korea said Monday it would begin disposing of South Korean assets at the Mt. Geumgang resort in the North, driving the fate of a joint tourism project close to the brink in a move that could have major repercussions for cross-border ties.
In a statement by the North’s official Korean Central News Agency (KCNA), the Stalinist regime said Seoul was at fault for not responding to proposals on how to handle assets at the scenic resort, the site of a stalled joint tourism project.
Seoul quickly denounced the unilateral moves while stressing it would put the safety of South Korean workers at the resort ahead of political moves.
“We will prioritize the safety of our citizens who are currently there and seek out all necessary measures, including legal and diplomatic steps,” Unification Ministry spokesman Chun Hae-sung told reporters.
The 14 South Koreans who have comprised the bare-bones staff at the facilities are expected to return Tuesday or Wednesday depending on the North’s time frame. Officials said they faced no safety risks.
Earlier, the North’s state media signaled its intent, saying the South “completely abandoned the protection of property and interests of enterprises of the South side.” It added Pyongyang would begin “a real legal disposal of all the properties including real estate, equipment and vehicles.”
Seoul called the unilateral action “regrettable” and said it would use all legal and diplomatic means to protect the property. Chun added it would consult with the firms involved with the resort.
It was the North’s strongest language yet over the site after threatening for months to dispose of the property owned by Hyundai Asan and other South Korean companies, in frustration over Seoul’s refusal to resume the tours.
Pyongyang has been pressuring Seoul on the project in a bid to buoy its economy, hobbled by international sanctions. It seized or froze several South Korea-owned properties last year, and passed a law in June to develop the site as a special zone for international tours.
Last month, it demanded the firms choose between joining the new program or seeing their assets, worth some 300 billion won ($284 million), disposed through lease, transfer or sale.
Officials from the sides held two rounds of talks beginning in late June that yielded no results. The North demands to deal directly with the businesses.
Four Hyundai Asan officials visited the North on Friday but the North only blasted Seoul for using the site to ratchet up tensions.
Officials have previously said the Lee Myung-bak administration is willing to take the matter before international arbitration as the North’s moves breaches inter-Korean agreements and those between Pyongyang and the firms. Analysts say if the North opens the resort to outside investment it could fall into the hands of mostly Chinese investors within a few years.
Earlier this month, a New York-based company said it had agreed a deal with the North to become an agent for tours there.