FACTBOX: South Korean candidates' policies on North

(Reuters) - South Koreans elect a new president on Wednesday with the front-runner to win the race promising a tough line on North Korea, where aid is tied to progress on ending its nuclear arms program.

The following are brief outlines of the North Korean policies of front-runner Lee Myung-bak, the candidate of the conservative Grand National Party, and Chung Dong-young, the nominee of the left-leaning, ruling United New Democratic Party, who once served as unification minister.

LEE MYUNG-BAK

* If North Korea scraps nuclear weapons, Lee would establish a $40 billion international investment fund, equivalent to about double the North's yearly economic output.

* Increase per capita income to $3,000 in 10 years with 15 percent to 20 percent annual growth.

* Rebuild the North's economy, education system, finance sector, infrastructure and welfare. Plant millions of trees on mountains stripped bare for timber.

* Build a new highway that links Seoul to Sinuiju, a North Korean city in the northwest that borders China.

* Set up five free-economic zones in the North.

* On an issue not tied to nuclear talks, Lee will provide economic assistance if North Korea agrees to free and open visits for families separated by Korean War as well as open communication.

CHUNG DONG-YOUNG

* Seeks a North-South peace economy by linking South Korea's technology to North Korea's labor.

* Expand a South Korean-run industrial park in North's border city of Kaesong. Seek foreign investment there and build similar joint parks.

* Work to establish diplomatic ties between North Korea and the United States, as well as between North Korea and Japan.

* Seek a Korean-led peace treaty to be signed by the United States and China to replace the ceasefire that ended the 1950-1953 Korean War. Then seek arms reduction with North.

* Turn the Demilitarised Zone buffer that divides the peninsula into a nature reserve and peace park.

(Reporting by Jessica Kim, writing by Jon Herskovitz; Editing by Grant McCool)