World Apr. 22, 2009 - 03:24AM JST ( 6 )

SEOUL —

Rare talks between North and South Korea ended without agreement late Tuesday after Pyongyang made tough new demands about the operations of a joint industrial estate on its territory, officials said.

The talks, the first since a conservative government took office in Seoul almost 14 months ago, were delayed some 12 hours by procedural wrangles and lasted just 22 minutes when they finally got underway.

Cross-border relations are at their worst in a decade after South Korean President Lee Myung-Bak abandoned his predecessors’ policy of providing almost unconditional aid to the communist state.

Regional tensions are also rising after the North’s purported satellite launch on April 5, widely seen overseas as a disguised missile test.

The North, angry at U.N. censure of the launch, has announced it is quitting nuclear disarmament talks and restarting its atomic weapons program. It has expelled U.S. and U.N. nuclear inspectors.

Each side presented written demands during the talks at the Kaesong joint industrial estate just north of the heavily fortified border, said Seoul’s unification ministry, which handles cross-border ties.

A ministry spokesman said Pyongyang told Seoul it would consider ending “benefits” for South Korean companies at Kaesong, including low wages for the North Korean employees.

The North also demanded a review of wages and contracts at the estate and said it would charge land use fees there from next year.

It refused to give Seoul’s delegation access to a South Korean worker who was detained at Kaesong on March 30 for allegedly criticizing the North’s communist system.

“Our side strongly called for the release of the man detained by North Korea as well as an interview with him,” the unification ministry spokesman said.

Seoul also called for further talks but there was no agreement on another meeting, the spokesman said.

In addition, Pyongyang is angry at Seoul’s announced intention to join a U.S.-led initiative against shipments of weapons of mass destruction.

It says any move by its neighbor to join the Proliferation Security Initiative (PSI) would be seen as a declaration of war.

At an emergency security meeting after the return of the South Korean delegation, President Lee Myung-Bak reaffirmed Seoul’s decision to become a full member of the PSI but did not specify when it would be officially announced, Yonhap news agency reported.

Kaesong was built as a symbol of reconciliation between two countries which have remained technically at war since their 1950-1953 conflict.

But operations have often been hit by political tensions. In December the North restricted border crossings and expelled hundreds of South Korean managers from the estate.

Some 38,300 North Koreans work at 101 South Korean firms, producing items such as garments, kitchenware and watches.

They are paid around $75 a month including insurance but the money goes directly to the North’s state bodies, which return a portion to the workers.

The estate is an attempt to combine the North’s cheap but skilled labor with the South’s capital and know-how. Any hefty wage rises could destroy its rationale.

The Seoul government and South Korean businesses have invested 730 billion won ($548 million) into the venture since its construction began in 2002. It opened in 2005.

The impoverished North received $26 million from South Korean firms last year in wage payments, according to unification ministry data.

Wire reports