North Korea ghost town reflects deeper woes as it woos Chinese

Thu Sep 1, 2011 9:12am EDT
 
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By Jeremy Laurence

MOUNT KUMGANG, North Korea (Reuters) - Long grass grows around the idle hotels, stores are covered in cobwebs and a big padlock hangs off the front of the bank at the deserted shopping center.

This is a modern day ghost town in already poverty-stricken North Korea, even though it is funded by wealthy neighbor and rival South Korea.

The east coast Mount Kumgang resort was once a symbol of cooperation. Now it's a stark reminder of the divide between the communist North and capitalist South, technically still at war having only signed an armistice, not a peace treaty, to the end their 1950-53 civil conflict.

Three years ago, the shooting of a South Korean tourist by a North Korean soldier resulted in Seoul halting tours to the complex, effectively drying up a source of much needed hard currency for the reclusive North.

The North said last month time had run out to resolve the row, expelling the South's remaining workers and saying it would start selling South Korean assets at the resort, valued at around $450 million.

South Korea's Hyundai Asan is by far the biggest investor and has exclusive rights to run tours to the resort for the next few decades. The South Korean government has also invested heavily, building a meeting venue for Korean families separated during the Korean War, duty-free shops and a cultural hall.

The North says that those contracts are now invalid. Seoul has countered that it will take political and diplomatic measures to ensure its assets are protected.

NUCLEAR BACKDROP   Continued...

 
<p>A man walks past an empty shopping area of the Mount Kumgang resort in Kumgang August 31, 2011. REUTERS/Carlos Barria</p>