Koreas fail to agree on steps to improve joint factory park

(ATTN: UPDATES throughout; ADDS comments by S. Korean delegate)
SEOUL, Feb. 2 (Yonhap) -- South and North Korea failed Monday to agree on steps
to improve their joint factory park in the North, officials said, amid tension
raised by days of artillery firing by the communist state last week.
The sides, however, agreed to use future military talks to discuss border
restrictions that have slowed South Korean transportation and communication in
and out of the complex in the North Korean border town of Kaesong, officials at
Seoul's Unification Ministry said.
North Korea fired hundreds of artillery shells into its waters along the western
sea border, called the Northern Limit Line (NLL), with South Korea for three
days last week, prompting the South to respond with warning shots on the first
day.
During Monday's talks, the South Korean delegation protested the shelling,
ministry spokesman Chun Hae-sung told reporters. The North Korean side retorted,
saying it was "a due military drill," he said.
North Korea refuses to honor the NLL that has served as the de facto maritime
border between the two Koreas. It was drawn by a U.S. commander of the U.N.
forces, which fought on the South Korean side in the Korean War, at the end of
the three-year conflict.
Further raising tension, North Korea declared five additional maritime areas off
the country's east and west coasts as "no-sail" zones over the weekend, South
Korea's military official said earlier in the day.
The talks in Kaesong were the second this year focusing on ways to boost the
profitability of the park, the most tangible symbol of reconciliation efforts
made in the first inter-Korean summit in 2000. Some 110 South Korean
manufacturers employ about 42,000 North Korean workers at the complex to produce
labor-intensive products.
The sides had met for three days in Kaesong last month but failed to reach an
agreement on mutual objectives, as the South refused to accept North Korea's
demand that pay raises be negotiated during the meetings.
"Pay is directly related to productivity, which can be improved only if
infrastructure and facilities are improved," chief South Korean delegate Kim
Young-tak told reporters after returning from the latest round of talks late
Monday night.
"I spent much time trying to make the North Korean side understand why it is so
important to quickly resolve the border restrictions and how that is directly
related to productivity and competitiveness," he said.
South Korea maintains the wage issue should be sidelined until the sides make
progress in lifting the border restrictions imposed by the North. Kim said the
restrictions will be discussed during military talks that the North proposed last
week, but South Korea has yet to notify the North when their military officials
will meet.
The South Korean delegation also pushed the North to remove restrictions
affecting the planned construction of a facility to house North Korean workers,
Kim said.
The industrial park, which began operating in 2004 and exported nearly US$10
million between 2005 and 2008, came under scrutiny last year as inter-Korean ties
fell to their lowest level in recent years.
In a reversal of its stance toward Seoul, however, Pyongyang has in recent months
proposed talks aimed at improving cross-border relations. In December, delegates
from the two sides participated in a joint survey of industrial parks in China
and Vietnam, which led to the Jan. 19-21 talks that served as a follow-up to the
trip.
Analysts say the North Korean offer of talks is part of a peace offensive aimed
at raising the standard of living for North Koreans and achieving its goal of
becoming a "strong and prosperous nation" by 2012.
The smoothing of relations with the outside world, which would pave the way for
foreign investment and trade, is also key for the North to attain that goal, they
say.
North Korea, which drew harsh U.N. sanctions for its nuclear test last year, also
seeks to return to six-nation talks that could bring economic and political
compensation for progress in its denuclearization. But it has insisted the
sanctions first be lifted and that talks aimed at formally ending the Korean War
be launched.
samkim@yna.co.kr
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