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(LEAD) S. Korea urges N. Korea to retract decision on tourism deal

All Headlines 15:49 April 09, 2010

(ATTN: ADDS S. Korean company's response in paras 9-10; ADDS comment by Seoul official in para 4; INSERTS direct quote from N. Korean statement in para 7)
By Sam Kim

SEOUL, April 9 (Yonhap) -- South Korea urged the communist North Friday to withdraw its decision to ditch Seoul as its partner for a tourism project and freeze southern assets at a mountain resort, saying Pyongyang should resolve any problems through dialogue.

The North also said in an announcement Thursday that it will kick out southern personnel from the facilities to be frozen, accusing Seoul of throwing away the now-suspended cross-border tourism program to its Mount Kumgang, which had been considered a key symbol of inter-Korean reconciliation.

The move reflects Pyongyang's anger and impatience over Seoul's reluctance to resume the lucrative tours that were suspended in 2008 after a South Korean tourist was shot dead near the North Korean resort.

"We are very regretful," Unification Ministry spokesperson Chun Hae-sung told reporters, adding his government will maintain an "unwavering stance."

"The decision must be retracted immediately," he said in a briefing.

Chun said, however, that no South Koreans were removed as of Friday morning from the facilities, including a family reunion center, a duty free shop and a hot spring amenity.

In Thursday's announcement, North Korea said its agreement with a South Korean tour organizer, Hyundai Asan, is "no longer valid due to the South Korean authorities" and that it will team up with a new tour operator.

A local South Korean broadcaster reported early Friday that the North formed a partnership with a Chinese tour operator for the mountain tour program. But the ministry spokesman, Chun, said he had no information on the reported deal.

Hyundai Asan, a subsidiary of South Korea's Hyundai Group, called for "serious talks" between Seoul and Pyongyang before the situation worsens. Its incipient joint tour project to the ancient city of Kaesong near the west coast has also been halted since late 2008 amid deteriorating inter-Korean relations.

About 70 employees of Hyundai Asan and its sub-contractors are still staying at the resort. The North said Thursday it would kick out personnel from facilities run by the state-run Korea Tourism Organization.

Tours to the mountain earned the sanctions-hit North millions of U.S. dollars.

Seoul says the tours will not resume until Pyongyang apologizes for the 2008 shooting death of a tourist, allows an on-site probe and makes state-to-state promises for tourist safety.

Pyongyang says it has done everything to relieve concerns.

North Korea will be "entirely responsible for any consequences" if the communist neighbor refuses to retract its decision, Chun said. The divided states have held a series of negotiations this year on resuming the tours but produced no breakthrough.

Dozens of South Korean firms, including Hyundai Asan, the chief operator of the now suspended tours, possess 360 billion won (US$320 million) worth of real estate in the tourist zone.

The North also threatened Thursday to "entirely reevaluate" its joint industrial park with South Korea near its west coast if relations between the sides do not improve.

The Kaesong industrial complex, which links more than 110 South Korean firms with some 42,000 North Korean workers, is the last remaining symbol of reconciliation between the divided states.

South and North Korea remain technically at war after the 1950-53 Korean War ended in a truce rather than a peace treaty.


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