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Two Koreas fail to agree in talks on joint project

The Kaesong joint industrial estate.

US officials meet with China on NKorea sanctions
A US delegation met on Thursday with Chinese officials for talks on implementing UN sanctions imposed on North Korea in retaliation for its nuclear test in May, officials said. Delegation head Philip Goldberg -- the State Department's point man on coordinating implementation of the sanctions -- told reporters he had "very good discussions" in Beijing during the day. "Our objective is the full implementation of the UN resolutions on North Korea," he said. "We intend to implement these resolutions with the overall goal of returning to a path of denuclearisation and nonproliferation on the Korean peninsula." US embassy spokesman Richard Buangan said earlier that Goldberg met with officials from China's foreign ministry. "Mr Goldberg is leading an inter-agency delegation including the National Security Council and the departments of Treasury and Defence," he told AFP. "The purpose of his trip is to consult with our partners in the region on implementation of UN Security Council resolution 1874." The resolution, adopted in response to North Korea's May 25 nuclear test, calls for beefed up inspections of air, sea and land shipments going to and from North Korea, and an expanded arms embargo. China, which supported the resolution, has been criticised by the United States in the past for lacking enthusiasm for implementing UN sanctions against North Korea, its neighbour and ally. Goldberg declined to comment on China's commitment towards implementing the UN sanctions. "I will leave the Chinese position to the Chinese. The US position is that we want all the various aspects of the resolutions to work. It is our intention to fully implement the resolutions," he said. Goldberg, who holds an ambassador rank, also was tentatively scheduled to hold further talks with Chinese officials on Friday, Buangan said. While Goldberg was engaged in the talks in Beijing, North Korea fired two short-range missiles from a base near the eastern port of Wonsan, South Korea's defence ministry said. Goldberg told reporters he had no details on the launch.
by Staff Writers
 Seoul (AFP) July 2, 2009
 North and South Korea failed to reach agreement in talks Thursday about the fate of their last major joint business project, amid high cross-border tensions and the North's continuing nuclear standoff with the world.

The two sides could not narrow differences and did not set a date for the next round, Seoul's unification ministry said.

The meeting at the Kaesong joint industrial estate just north of the border lasted just one hour and 10 minutes, far shorter than their last discussions in June.

The South rejected the North's demands for huge wage and rent increases at the Seoul-funded estate. It insisted on the immediate release of a South Korean worker at Kaesong who has been held incommunicado by the North since March 30.

"Our side said in a keynote speech that we cannot accept North Korea's unreasonable demands that it has presented over the joint park after unilaterally scrapping existing contracts," Yonhap news agency quoted a unification ministry official as saying.

Representatives of the 105 South Korean firms at Kaesong say many of them are already close to bankruptcy because of falling orders amid icy cross-border relations.

At the first round of talks last month Pyongyang stunned Seoul by demanding a wage rise for its 40,000 workers to 300 dollars a month from around 75 dollars currently.

It also demanded an increase in rent for the estate to 500 million dollars, compared with the current 16 million dollars for a 50-year contract.

At the second round the North stuck to its financial demands but offered to lift restrictions on border crossings it imposed last December.

On Thursday the South demanded the worker's release and urged the North to stop insulting its president, Lee Myung-Bak, according to unification ministry spokesman Chun Hae-Sung.

"The North repeated its demand that the rent issue must be discussed first and refused to talk about the agenda proposed by our side," Chun said.

Foreign Minister Yu Myung-Hwan said separately Seoul may have to raise the detainee issue at a regional security meeting, the ASEAN Regional Forum, later this month.

Kaesong, which opened in December 2004, is the last operating reconciliation project between communist North and capitalist South.

Its future has become increasingly uncertain as inter-Korean relations have worsened and as the North's nuclear standoff with the world has intensified.

Some analysts believe the North wants to keep the estate going since it now faces tighter curbs on lucrative missile exports, under UN and US sanctions imposed in response to its May 25 nuclear test.

The cash-strapped North received 26 million dollars last year in wage payments at Kaesong.

Others say Pyongyang may be willing to forgo the cash because it fears exposing its workers at Kaesong to a South Korean lifestyle.

"From Pyongyang's point of view, each worker ... was a poster advertising capitalism, damaging the socialist system," said Leonid Petrov, research associate at the Australian National University, in an article this week.

The North alleges the South Korean worker slandered its political system and tried to incite a local woman worker to defect. Amnesty International has called for his immediate release.

Cross-border relations have been hostile for the past year, since Seoul's new conservative government rolled back a "sunshine" aid and engagement policy with Pyongyang.

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