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North Korea seizing South's assets at Diamond Mountain resort

Seoul’s refusal to re-start tourist trips to the joint resort after a South Korean tourist was shot dead three years ago has angered Pyongyang.

North Korean Army soldiers, background, look at the southern side as South Korean Army soldiers stand guard at the border village of Panmunjom in October 2010.
North Korean Army soldiers, background, look at the southern side as South Korean Army soldiers stand guard at the border village of Panmunjom in October 2010.
Image: AP Photo/Ahn Young-joon/PA Images

PYONGYANG’S VOW to scrap all South Korean property at a joint mountain resort could end what was once a rare haven for curious southern tourists within North Korea.

For a decade, visitors from the South came in droves to Diamond Mountain, essentially a modern South Korean resort an hour’s drive into the North, where they could play golf, relax in hot springs and soak up the folklore of the beautiful mountain.

One of the few bright spots of cooperation between the divided countries, however, has been on hold since a North Korean soldier shot and killed a South Korean woman at the resort three years ago.

Tours suspended

North Korea is now threatening to end it completely by getting rid of South Korean assets and opening the resort to international investors. On Monday, Pyongyang ordered all South Korean workers at the resort to leave within 72 hours and banned any South Korean property from being removed.

The North is angered by Seoul’s refusal to resume the lucrative tours until Pyongyang formally apologises for the shooting death and allows a joint investigation.

Diplomats from the United States and the two Koreas are separately pursuing tentative talks meant to jump-start North Korean nuclear disarmament talks, but the meltdown at Diamond Mountain — once a promising symbol of potential inter-Korean cooperation — shows how deep animosity runs on the Korean peninsula.

The South immediately expressed regret today about the North’s comments on Diamond Mountain and planned to seek international mediation.

Nestled near a craggy mountain range that stretches to the sea, the resort drew hundreds of millions of dollars of South Korean investment until the shooting death halted cross-border tours in July 2008.

Joint resort

Diamond Mountain tours started in 1998 under the initiative of a South Korean tycoon with roots in the North. Nearly 2 million South Koreans flocked to the resort, eager to see its beauty and be part of a spirit of reconciliation that blossomed during two liberal South Korean governments’ engagement with the North.

Often hailed as the peninsula’s most beautiful peak, Diamond Mountain has been praised by both ancient and modern Korean musicians, painters and historians. The North’s media often tout its beauty, describing the way white clouds drift over its saw-toothed peaks.

The land around Diamond Mountain, however, has seen tension since the 1950-53 Korean War. Thousands of troops died fighting to conquer hills south of the mountain during the war. Two years before the tours began, a group of armed North Korean infiltrators slipped south of the border aboard a submarine, rattling South Koreans until most of the agents were killed.

The start of the tours led to many of the troops guarding the border to fall back and allowed South Korean businesses to capitalise on a tourism asset they had long eyed.

The languishing resort appeared in fair condition last year when family members separated by the truce that ended the Korean War were briefly reunited under a Red Cross programme. A handful of workers were stationed there by South Korea’s Hyundai Asan company, the resort’s operator. Slogans were carved into hillside rocks, with propaganda billboards hailing North Korean leader Kim Jong Il as “the sun of the 21st century.”

Increased tension

Ties between the Koreas frayed badly last year. The North bombarded a South Korean island last November, killing four people. It also denies responsibility for the sinking of a South Korean warship that killed 46 sailors in March 2010.

North Korea in June told the South to draw up plans to salvage its assets. Hyundai Asan estimates $370 million in sales have been lost since the tours were suspended. North Korea had annually won tens of millions of dollars from the tours, analysts believe.

Hope that tours could be revived followed a meeting of nuclear envoys from North and South Korea held in Indonesia last month. A later visit by a high-level North Korean diplomat to New York was another sign of possible thawing in the Korean peninsula’s icy ties.

But last month the two countries failed to agree on more talks about the resort.

“The Diamond Mount programme is holding on to its last breath,” Kang Sung-yoon, a North Korea professor at Seoul’s Dongguk University, said.

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