Two Koreas to start fresh talks on Kaesong

SEOUL (AFP) - North and South Korea are to hold fresh talks on Monday on reopening a joint industrial complex whose fate is seen as a touchstone for future reduction of tensions on the Korean peninsula.

"I'll do my best to reopen Kaesong and develop it into an international industrial park," South Korea's chief delegate Kim Ki Woong told journalists before crossing the border.

Mr Kim replaced Mr Suh Ho in what was described as a regular reshuffle ahead of the talks which will take place at the Seoul-invested industrial zone in North Korea some 10 kilometres inside the border.

Pyongyang on Thursday retracted its proposals for separate meetings to discuss the resumption of tours to its scenic Mount Kumgang resort and reunions of families separated by the Korean War.

The move came after the South accepted the proposal for talks on resuming family reunions, while refusing to discuss the Mount Kumgang tours "in order to focus on the Kaesong talks".

Pyongyang has accused Seoul of insincerity after two previous rounds of talks last week failed to reach a firm agreement on restarting Kaesong, built as a symbol of reconciliation.

The South wants firm safeguards from the North against shutting Kaesong down unilaterally, to keep the zone insulated from changes in relations.

The industrial zone, just north of the border, opened in 2004 but shut down three months ago as relations approached crisis point.

At a rare meeting earlier this month, the two sides agreed in principle to reopen the estate, where 53,000 North Koreans worked in 123 Seoul-owned factories producing textiles or light industrial goods.

The North in April withdrew its workers from Kaesong, an important source of hard currency for Pyongyang, citing military tensions and what it called the South's hostility.

The talks - even though fruitless so far - were a contrast to months of cross-border friction and threats of war by Pyongyang, after its February nuclear test attracted tougher UN sanctions.

On Saturday, North Korea warned that the fate of the Kaesong talks would affect overall inter-Korean relations.

"Unless the Kaesong Industrial Complex issue is resolved, there cannot be any progress in inter-Korean relations," the North said in a statement carried by its official state media.