July 29, 2011 / 9:26 AM / 8 years ago

North Korea says time is up for joint resort

SEOUL (Reuters) - North Korea said on Friday it would start disposing of South Korean assets at a joint tourist resort in three weeks’ time, deepening a three-year long row which started with the shooting of a tourist in the area.

The sun rises at Mount Kumgang resort in North Korea, October 31, 2010. REUTERS/Kim Ho-Young/Korea Pool

The latest threat from Pyongyang comes despite an apparent thaw in tensions on the peninsula, with the North engaged in separate bilateral talks with Seoul and Washington.

The bilateral talks have raised hopes that long-stalled nuclear talks may soon restart.

The North said on Friday that South Korean companies operating at the Mt Kumgang resort on the North’s east coast risked losing their possessions if they did not come to negotiate their disposal.

The resort, which has been a lucrative source of hard currency for the cash-strapped North since the 1990s, has been closed since the shooting of a South Korean tourist there in 2008.

Seoul demands an investigation, an apology from the North and assurance it will not happen again. Pyongyang has refused and has threatened to end South Korean companies’ exclusive rights to run tours in a bid to force the South to back down.

“There is a three-week liquidation period, and if companies want to negotiate they have to come separately from the government within the period,” the South’s Unification Ministry, which deals with Korean affairs, quoted a North Korean letter to companies as saying.

“Companies can negotiate on asset disposal matters ... and for those who do not participate in the negotiations, they will be regarded as giving up their asset and it will be taken care of by the law.”

The North said in June it had revised a law overseeing the resort, effectively ending Hyundai Asan’s contract to run all cross-border tours to the resort.

The North says it wants to redevelop Mt Kumgang, once a symbol of cooperation between the rival states, as an international resort.

South Korea expressed deep regret and vowed to safeguard the property rights of its firms.

The Unification Ministry said that the North would be held accountable for all consequences resulting from its disposal of the assets, estimated to be worth about $285 million.

Reporting by Jeremy Laurence; Editing by Sugita Katyal

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