The Korea Herald


Koreas to meet this week to discuss fate of South Korean assets

By 신혜인

Published : July 11, 2011 - 19:20

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North Korea has agreed to hold talks with the South on Wednesday to settle a dispute over South Korean-owned buildings in a tourist resort in the isolated state, officials said.

Korea is thus to send a team of government officials and business representatitives to the corresponding resort, according to the Unification Ministry spokesperson Chun Hae-sung.

Monday, just two days before the date Pyongyang said it would dispose of the remaining Seoul-owned assets in its mountain resort. 

The two Koreas had launched the joint tour project at the North’s Mount Geumgang in 1998 as a symbol of reconciliation.

The tours, which had been one of impoverished Pyongyang’s main sources of income, came to a halt on July 11, 2008 after a South Korean tourist was shot dead by a North Korean soldier when she purportedly strayed into an off-limits military zone.

Some 300 billion won ($280 million) worth of facilities owned by dozens of South Korean companies ― restaurants, a fire station, a cultural center, a hot spring, hotels and a golf range ― have been out of use for three years as of Tuesday.

Seizing the assets in April last year, Pyongyang recently announced it would take legal steps to dispose of them unless Seoul investors decide how to handle them by July 13, which is this Wednesday.

The ministry, which specializes in affairs with Pyongyang, had suggested that the two sides meet in the South this week to discuss how to deal with the Seoul-owned assets and other issues related to the stalled tours.

“The North should immediately stop acts of infringement against property rights” of South Korean investors, added the spokesman.

A delegation of South Korean government officials and company representatives had visited Mount Geumgang late June to discuss the issue, only to be cold-shouldered by North Korean representatives who refused to talk with government officials present.

Pressed for outside aid and foreign currency, North Korea may be bringing up the issue of Seoul’s assets to either resume the tours unconditionally or to start business with other countries, analysts say.

While Pyongyang claims to have done enough on its side to deal with the 2008 shooting, Seoul demands that it investigate the case properly and sets up reliable prevention measures.

Hyundai Asan, the South Korean operator of the stalled tours, announced this weekend that it has suffered some 390 billion won in losses and had to cut back some 700 officials during the three-year suspension.

The North in April this year unilaterally terminated Hyundai Asan’s exclusive tourism rights to the resort and has reportedly begun tour programs with Chinese travel agencies.

The tug-of-war over Mount Geumgang tours comes as the two Koreas are in one of their worst states of relations after the communist North conducted two deadly attacks at a Seoul warship and a border island in March and November last year, respectively.

As Pyongyang continues to deny its role in the two attacks that killed 50 South Koreans, the Seoul government has suspended financial aid and dialogue for months.

By Shin Hae-in (