North Korea says it will seize 5 South Korean-owned assets at mountain resort in North

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NKorea says it will seize 5 SKorean assets

SEOUL, South Korea — North Korea said Friday it will confiscate five South Korean-owned properties at a jointly-operated mountain resort in the isolated communist country, a development likely to worsen already-soured relations.

North Korea has been demanding that the South resume tours to the facility, which had been a key source of foreign currency earnings for the impoverished nation but were suspended after a North Korean soldier shot a South Korean tourist to death in 2008.

South Korea has refused to restart tours until its demands for a joint investigation into the death are carried out and measures to guarantee the safety of tourists are outlined.

Tensions between the two Koreas are already high after a South Korean navy ship sank last month, killing at least 39 people and leaving seven missing, amid suspicion that North Korea may have been responsible. North Korea has denied involvement.

“The confiscated real estate will be put into the possession of the (North) or handed over to new businessmen according to legal procedures,” North Korea said in a statement carried by the official Korean Central News Agency on Friday.

The five seized properties were identified as a fire station, a duty-free shop, a reunion center for families separated by the 1950-53 Korean War, a cultural center where North Korean troupes performed for tourists and a spa.

The North also said it will freeze ownership of all the remaining South Korean real estate at the resort on the country’s east coast and expel all their management personnel. The North warned that it will “take more rigid follow-up measures” if South Korea challenges what the North calls legitimate steps. It did not elaborate.

The two Koreas started the tour program more than a decade ago as part of reconciliation efforts on the divided peninsula, which remains technically at war because the 1950-53 conflict ended with an armistice, not a peace treaty.

South Korea said it cannot accept the North’s move and vowed to strongly deal with what it called North Korea’s illegal and unreasonable steps. “We are reviewing specific countermeasures,” Unification Ministry spokesman Chun Hae-sung told reporters. He declined to elaborate.

Spokesman Roh Jee-hwan of Hyundai Asan, the main private South Korean tour operator at the resort, had no immediate comment.

Paik Hak-soon, a North Korea analyst at the private Sejong Institute think tank near Seoul, said the tour program fell victim to inter-Korean confrontation and suggested Seoul offer high-level talks with North Korea to resolve the dispute.

The North’s statement faulted South Korea for linking the sinking of the warship to the North, and called South Korean President Lee Myung-bak a traitor for comments connected with the North’s celebrations of its late founder’s birthday last week.

Lee had criticized North Korea for spending a reported 6 billion won ($5.4 million) on fireworks to mark Kim Il Sung’s birthday, saying the money would have been better spent on corn to ease the country’s chronic food shortages.

Separately, Lee said Friday that Seoul will cooperate with the international community on necessary steps after the outcome of an investigation into the sinking of the ship, which split into two. He did not elaborate.

His foreign minister has said Seoul will consider taking the case to the U.N. Security Council for possible stronger sanctions against North Korea if it is confirmed to be behind it.

South Korean officials have said that so far there has been no definitive evidence indicating the North’s involvement in the incident. However, suspicions have been fueled by the North’s history of attacks on the South and comments by the chief investigator that the ship was likely brought down by an external explosion.

On Friday, a huge floating crane hoisted the bow of the 1,200-ton Cheonan to the surface of the Yellow Sea in preparation for pulling it out of the waters and onto a barge Saturday, according to South Korea’s Joint Chiefs of Staff.

Last week, South Korea salvaged the stern and moved it to a naval base south of Seoul for investigation with foreign experts.