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North Korea has announced it will restore the key hotline with South Korea at Kaesong Industrial Complex, as the two countries discuss where to hold talks on the jointly-run industrial zone.

Pyongyang said it would reopen a Red Cross hotline which it cut in March.

It also invited officials to come to Kaesong for talks on Sunday on restarting operations at the factory zone, after the two sides agreed in principle to talks on Thursday.

Work at Kaesong has been halted since April, amid high regional tensions.

Ties between the two Koreas deteriorated earlier this year in the wake of the North’s 12 February nuclear test.

North Korea’s nuclear ambitions are expected to be on the table when the US and Chinese presidents meet in California later on Friday for an informal summit.

The Kaesong factory complex is seen as a symbol of North-South co-operation. Around 53,000 North Korean workers are employed there by more than 120 South Korean factories.

The zone is a key source of revenue for the North and the biggest contributor to inter-Korean trade.

North Korea has announced it will restore the key hotline with South Korea at Kaesong Industrial Complex

North Korea has announced it will restore the key hotline with South Korea at Kaesong Industrial Complex

 

However, Pyongyang withdrew its workers in April, apparently angered by tightened UN sanctions in the wake of its nuclear test and annual South Korea-US military drills.

It had already cut a military hotline with South Korea, and another line used to communicate with the UN Command at Panmunjom in the Demilitarized Zone that divides the two Koreas, in addition to the Red Cross hotline.

On Thursday, however, it offered talks with the South on the resumption of operations and said it would reconnect the Red Cross hotline if Seoul – which had been seeking such talks – agreed.

Pyongyang’s Committee for the Peaceful Reunification of Korea (CPRK) said the Red Cross link would be restored from 14:00 local time, AFP news agency said.

The two sides are still working out details of the talks on the industrial zone. The South suggested ministerial-level talks in Seoul on Wednesday, but North Korea has asked for lower-level talks on Sunday in Kaesong, which is located just inside North Korea.

In a statement, Pyongyang said that working-level talks were needed first, “in the light of the prevailing situation in which the bilateral relations have been stalemated for years and mistrust has reached the extremity”.

Kaesong Industrial Complex:

  • Launched in 2003, largely financed by the South to increase co-operation
  • More than 120 factories employ North Koreans in manufacturing industries, with goods exported to the South
  • Complex as a whole produced $470 million worth of goods in 2012 – the biggest contributor to inter-Korean trade
  • South Korean companies pay more than $80 million a year in wages to North Korean workers

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North Korea has proposed official talks with South Korea on normalizing commercial projects, weeks after operations at the joint Kaesong industrial zone were suspended.

In a statement from state news agency KCNA, North Korea said the place and date could be “set by the South side”.

Kaesong Industrial Complex, just inside North Korea, is a key source of revenue for Pyongyang.

But it pulled out its workers in April amid high tensions on the peninsula following its February 12 nuclear test.

Since then operations at the zone, where more than 100 South Korean manufacturers employ some 53,000 North Korea workers, have been halted for the first time since the project began a decade ago.

North Korea said late last month it would invite South Korean businessmen back to discuss the resumption of operations but Seoul ruled that out, saying working-level government talks should be held.

There was no immediate response from South Korea.

Mount Kumgang resort is a joint tourism project that has been suspended since a South Korean tourist was shot dead there by a North Korean guard in 2008

Mount Kumgang resort is a joint tourism project that has been suspended since a South Korean tourist was shot dead there by a North Korean guard in 2008

The KCNA statement, attributed to the Committee for the Peaceful Reunification of Korea, said that hotlines cut during the period of high tension would be reconnected if South Korea agreed to the talks.

“We propose holding talks between authorities of the North and the South for the normalization of the operation in the KIZ [Kaesong Industrial Zone] and the resumption of tour of Mt Kumgang,” it said.

The Mount Kumgang resort is a joint tourism project that has been suspended since a South Korean tourist was shot dead there by a North Korean guard in 2008. North Korea has since seized assets of the resort’s South Korean operator.

Restarting reunions of separated families could also be discussed, the North Korea statement said, adding: “The venue of the talks and the date for their opening can be set to the convenience of the South side.”

While South Korea may want to discuss Kaesong, its government has made it clear in the past that more wide-ranging dialogue should be linked to progress on denuclearization.

The offer comes after several months of threats and rhetoric from the communist North Korea.

Apparently angered by the US sanctions imposed after its third nuclear test and annual South Korea-US military drills, it warned of attacks on regional targets and cut key economic and communications links with Seoul.

In recent weeks, however, tensions appear to have lessened somewhat. Late last month, North Korea sent an envoy to Beijing – seen as having the greatest degree of influence on Pyongyang – for talks, for the first time since its nuclear test.

Pyongyang has announced it is willing to allow South Korean managers to visit the suspended jointly-run Kaesong Industrial Complex.

In a statement carried by state media, North Korea said it was prepared to discuss with the businessmen how normal operations could be resumed.

But South Korea expressed worry about its citizens’ safety and asked that government-level talks be held.

Operations at the joint industrial complex have been suspended since the North withdrew its workers in April.

North Korea’s Committee for the Peaceful Reunification of Korea (CPRK), responsible for ties with South Korea, said it would guarantee the businessmen’s safety.

“We have given permission for the visit and can even discuss the shipment of products at the industrial complex,” Yonhap news agency quoted the committee as saying.

South Korea “may send with them members” of the governing body that oversees the complex, the committee added.

Pyongyang has announced it is willing to allow South Korean managers to visit the suspended jointly-run Kaesong Industrial Complex

Pyongyang has announced it is willing to allow South Korean managers to visit the suspended jointly-run Kaesong Industrial Complex

But a spokesman for South Korea’s Unification Ministry, which handles relations with the North, said what was needed at this stage was talks between both governments, which Seoul has been requesting.

Some 123 South Korean companies have factories inside the Kaesong Industrial Complex, which lies just across the border inside North Korea.

The firms employ some 53,000 North Koreans and the zone is a key revenue earner for the North.

But Pyongyang withdrew its workers two months ago as North-South tensions escalated following Pyongyang’s third nuclear test in February.

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North Korea has strongly denied reports from South Korea that it is planning policy changes that will lead to the reform and opening of the country.

A government body dismissed reports that the present leadership was breaking with the past as “ridiculous”.

Some commentators have speculated that the recent removal of North Korea’s top general pointed to a possible power struggle over economic reform.

Kim Jong-Un succeeded his late father, Kim Jong-Il, in December.

Kim Jong-Un, believed to be in his late 20s, has since adopted a warm public persona, being photographed at fun fairs and pop concerts with his young wife Ri Sol-Ju.

Kim Jong-Un, believed to be in his late 20s, has since adopted a warm public persona, being photographed at fun fairs and pop concerts with his young wife Ri Sol-Ju

Kim Jong-Un, believed to be in his late 20s, has since adopted a warm public persona, being photographed at fun fairs and pop concerts with his young wife Ri Sol-Ju

That – together with the recent removal of army chief General Ri Yong-Ho – has fuelled hopes in the South that he could be planning to open up North Korea’s closed state-run economy.

However, a spokesman for North Korea’s Committee for the Peaceful Reunification of Korea, which deals with cross-border affairs, dismissed the speculation in an interview with state-run KCNA news agency on Sunday.

He said that Kim Jong-Un would pursue the “military first” policy brought in by his father and would build a “civilized and comfortable life for the people under socialism”.

“The puppet group (South Korea)… tried to give (the) impression that the present leadership of the DPRK (North Korea) broke with the past. This is the height of ignorance,” the spokesman said.

“To expect policy change and reform and opening from the DPRK is nothing but a foolish and silly dream, just like wanting the sun to rise in the west.”

He accused Seoul of trying to impose capitalism on Pyongyang by “trumpeting reform and opening”, adding: “There cannot be any slightest change in all policies.”

Any reference to reform has always been anathema for North Korean officials and it is a word they associate with victory for their capitalist enemies in the South.

There is also substantial external pressure for change, not least from China, which appears close to Kim Jong-Un and his inner circle and which has pressed for reform in North Korea for more than a decade.

Kim Jong-Un and those around him are being keenly watched for the direction in which they will take the communist state.