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SEOUL: North Korea accused South Korea of pushing negotiations about the fate of their joint-venture industrial estate in Kaesong to the brink of collapse.
Talks about the Kaesong estate have been pushed "to the phase of breakdown due to the insincere attitude" of Seoul, a spokesman for the North's office in charge of the park said in a statement.
Kaesong near the west coast is the last major joint project still operating. Its future has become increasingly clouded since the North demanded huge extra payments from Seoul and detained a South Korean worker there.
Cross-border relations have sharply worsened in the past year, and the communist North's standoff with the world over its nuclear and missile programmes has intensified in recent months.
Another showcase project also funded by Seoul, the Mount Kumgang resort on the east coast, has been shut since the North's soldiers shot dead a South Korean woman tourist there one year ago.
Last week the two sides failed to agree in talks about the future of Kaesong just north of the border, and set no date for the next round of negotiations.
At the first round of talks last month Pyongyang stunned Seoul by demanding a wage rise for its 40,000 workers to US$300 a month from around US$75 currently.
It also demanded an increase in rent for the estate to US$500 million, compared with the current US$16 million for a 50-year contract.
South Korea rejected the demands and insisted on the immediate release of a South Korean worker who has been held incommunicado since March 30.
The North alleges he slandered its political system and tried to incite a local woman worker to defect.
The North's spokesman accused Seoul negotiators of adopting a "rude and insincere attitude" intended to lay the blame for the estate's collapse on Pyongyang.
The North is now "compelled to seriously reconsider the issue of whether it would continue the contact with such ungrateful and impolite counterpart or not," he said.
"In case the south side fails to honestly approach the working contact, the north side will go according to its decision as it has already clarified."
The North had previously told owners of the 105 South Korean firms at Kaesong that they must accept the new financial terms or get out.
The companies say many of them are already close to bankruptcy because of falling orders amid icy cross-border relations.
The cash-strapped North received US$26 million last year in wage payments at Kaesong.
Some analysts say it may be willing to forgo the money because it fears the effects of exposing its workers to a South Korean lifestyle.
But they say it cannot make the first move to shut down the project because it was initiated by leader Kim Jong-Il.
Kaesong and Kumgang were developed under a decade-long "sunshine" engagement policy by liberal governments in Seoul. The current conservative government rolled back the policy, enraging Pyongyang.
Relations worsened further after the tourist was shot dead at Kumgang resort on July 11 last year after straying into a poorly-marked military zone.
South Korea suspended tours after Pyongyang rejected an on-site investigation and blamed Seoul for the tragedy.
In a statement marking the first anniversary of the shooting, the South's unification ministry called for talks with North Korea on the stalled tour programme.
- AFP/yb
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