N. Korea expels S. Koreans from industrial zone, seizes assets

Jung Ha-Won
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Anti-North Korean activists burn placards showing N.Korean leader Kim Jong-Un as they protest the latest nuclear test and rocket launch by Pyongyang, in Seoul, on February 11, 2016

Anti-North Korean activists burn placards showing N.Korean leader Kim Jong-Un as they protest the latest nuclear test and rocket launch by Pyongyang, in Seoul, on February 11, 2016 (AFP Photo/Ed Jones)

Seoul (AFP) - North Korea on Thursday expelled all South Koreans from the jointly-run Kaesong industrial zone and placed it under military control, saying Seoul's decision to shutter the complex had amounted to a "declaration of war".

Pyongyang said it was seizing the assets of all the 124 South Korean companies operating factories in Kaesong, which lies 10 kilometres (six miles) across the border inside North Korea.

It also cut two key communication hotlines with Seoul, preventing any further official discussion of the situation at the complex.

All 280 South Koreans ordered to leave Kaesong finally crossed the border back into South Korea shortly before 10:00 pm (1300 GMT), easing concerns for their safety amid speculation that some might be detained.

After their return, Seoul cut off electric power transmission to the complex, a measure that would also lead to the water supply being stopped, South Korea's Yonhap news agency said citing officials.

The North's aggressive measures marked a significant escalation of cross-border tensions that have been elevated since North Korea carried out a nuclear test last month and a long-range rocket launch on Sunday.

Seoul had announced on Wednesday it was closing down operations at Kaesong, and the North said it would now experience the "disastrous and painful consequences" of its action.

- 'Last lifeline' snapped -

By shutting Kaesong, the South had destroyed the "last lifeline" of North-South relations and made a "dangerous declaration of war," the North's Committee for the Peaceful Reunification of Korea (CPRK) said in a statement.

Relations between the two Koreas have always been volatile, but analysts said the current situation risked turning into a full-blown crisis.

"Now we can say that all strings between the Koreas have been cut and that there are no more buffers," said Ko Yoo-Hwan, a professor of North Korean Studies at Dongguk University in Seoul.

"An escalation of tensions is inevitable, and I see further trouble ahead with Kaesong and the issues of seized assets, especially if North Korea militarises the zone," Ko said.

All South Koreans were ordered to leave Kaesong by 5:00 pm Pyongyang time (0830 GMT) and told they could take nothing but their personal possessions.

The North also said it had ordered a "complete freeze of all assets," including raw materials, products and equipment.

The owners of the South Korean companies in Kaesong had sent more than 100 empty trucks into the North on Thursday morning in the hope of bringing out as much as they could.

- Goods left behind -

"I only brought back about one-thirtieth of what was there," Kang Sung-Ho, the manager of a shoe company said as he crossed the border.

Although there had been a rush to leave after the expulsion order came, Kang said the North Korean officials had been quite reasonable.

"They didn't give us a hard time because we've known each other for a long while," he said, reserving his anger for the South Korean government's original decision to close Kaesong operations.

"We had to leave our finished products untouched and we will have to provide financial compensation to our buyers. I feel terrible," he said.

Despite the ban on removing anything beyond personal belongings, a few trucks that managed to cross the border earlier in the day had managed to bring out more materials.

Defending its decision to halt operations at Kaesong, Seoul said North Korea had been using the hundreds of millions of dollars in hard-currency that it earned from the complex to fund its nuclear weapons and ballistic missile programmes.

The move was slammed as "utterly incomprehensible" by the Kaesong company owners who said their businesses were being destroyed by politics.

Born out of the "sunshine" reconciliation policy of the late 1990s, Kaesong opened in 2004 and proved remarkably resilient, riding out repeated crises that ended every other facet of inter-Korean cooperation.

The United States signalled its own unilateral moves against North Korea, with the US Senate on Wednesday unanimously adopting a bill expanding existing sanctions.