Koreas agree to hold talks on reopening joint factory complex

North and South Korea on Thursday agreed to hold talks on reopening a jointly run factory complex and other cross-border issues, after months of deteriorating relations and a day before a U.S.-China summit in which the North is expected to be a key topic.

The envisioned talks could help rebuild avenues of inter-Korean cooperation that were obliterated in recent years amid hardline stances by both countries, though the key issue isolating the North from the world community — its nuclear program — is not up for debate.

The North's Committee for the Peaceful Reunification of Korea, in a statement carried by state media, said it is open to holding talks with Seoul on reopening the Kaesong complex just north of the Demilitarized Zone separating the countries. The complex closed this spring.

It also proposed talks on resuming reunions of families separated by war, and on resuming South Korean tours to a mountain resort in the North.

Pyongyang offered to let the South set the time and venue, and hours later South Korean Unification Minister Ryoo Kihl-jae proposed meeting on all three topics in Seoul on June 12.

South Korean President Park Geun-hye welcomed the North Korean agreement to government-level talks that Seoul had proposed in April.

"I feel it's fortunate that the North accepted the proposal for government-level talks even though (the acceptance) came late," she said, according to her presidential office.

The agreement to meet could represent a change in North Korea's approach, or could simply be an effort to ease international demands that it end its development of nuclear weapons. Pyongyang has committed a drumbeat of provocative acts since April 2012, when it scuttled a nuclear and humanitarian aid deal with the U.S. by launching a rocket that was viewed as an effort to test its long-range missile technology.

The isolation of the authoritarian country has grown following a satellite launch in December and a nuclear test in February. Pyongyang was enraged by the United Nations Security Council sanctions those actions brought, and further angered by U.S.-South Korean military drills that the allies call routine but that the North claims are invasion rehearsals. Pyongyang earlier this year threatened nuclear attacks on Seoul and Washington.

Lee Ji-sue, a North Korea specialist and professor at Myongji University in Seoul, said Pyongyang has been forced to pull back in large part because of China, its neighbor and ally.

North Korea's economy relies heavily on China, which like the U.S. wants North Korea to give up its nuclear ambitions. Under American urging to pressure the North, Beijing has tightened inspections on cross-border trade, and its state banks have halted business with North Korea's Foreign Trade Bank.

Pyongyang's statement came after Choe Ryong Hae, a North Korean military official and confidant of leader Kim Jong Un, met with Chinese President Xi Jinping in Beijing in late May and said that Pyongyang was "willing to accept the suggestion of the Chinese side and launch dialogue with all relevant parties."

"North Korea has reached critical mass for talks," Lee said. "Even its ally China is cutting off bank dealings. Nothing is working out for the North. It needs a breakthrough now."

Lee said it still remains to be seen whether North Korea's overtures are genuine. "If North Korea starts accepting South Korean conditions one by one in future talks, we can then say it is really serious," he said.

China welcomed the Koreas' impending talks. "We hope they will cherish this hard-won momentum of dialogue, actively promote easing the situation and remain committed to peace and stability in the Korean Peninsula," Foreign Ministry spokesman Hong Lei said in Beijing.

Xi is meeting President Barack Obama in California on Friday, and Koh Yu-hwan, a North Korea expert at Seoul's Dongguk University, said Pyongyang's announcement is timed for those talks.

"North Korea is making it easier for China to persuade the U.S. to get softer on Pyongyang," Koh said.

Xi is also scheduled to meet with Park later this month.

Ryoo, the unification minister, asked Pyongyang to follow through on its offer to restore its Red Cross communication line with South Korea by Friday so the sides could start discussing arrangements for the talks. The line is among several ties between the Koreas cut by the North in the last several months.

A likely partner for Ryoo in minister-level talks would be Kim Yang Gon, secretary of the Central Committee of the ruling Workers' Party. Kim visited Kaesong in early April before the North withdrew all its workers from the park.

The decade-old Kaesong complex, the product of an era of inter-Korean cooperation, shut down gradually this spring after Pyongyang cut border communications and access, then pulled the complex's 53,000 North Korean workers. The last of hundreds of South Korean managers at Kaesong left last month.

More than 120 South Korean companies had operations at Kaesong, which gave them access to cheap North Korean labor. It was also a rare source of hard currency for North Korea, though the economically depressed country chafed at suggestions that it needed the money Kaesong generated.

Smiling broadly, Han Jae-kwon, chief of the association of South Korean factories in Kaesong, told reporters that he welcomes the agreement. "We are having hope that the Kaesong factory park will be revived," he said.

The talks will be the first government-level negotiations between the two Koreas since President Park took office earlier this year with a North Korea policy dubbed "trustpolitik." She has outlined her intention to reach out to the foes to build trust while remaining firm on intolerance to provocations.

After relations dropped to their lowest level in decades under her predecessor, Lee Myung-bak, North Korea had been looking for a change under Park, who visited North Korea in 2002. But the first 100 days of her administration were trying times for "trustpolitik" as Pyongyang threatened to carry out nuclear attacks and to close Kaesong.

Both sides, however, have been looking for a face-saving way to restart relations. Pyongyang proposed a joint event on June 15, the anniversary of their 2000 agreement on reconciliation; Seoul has so far rejected the proposal.

The mood on the Korean Peninsula has been tense since North Korean leader Kim Jong Il died in December 2011. Pyongyang denounced Seoul for blocking most civilian visits to the North to pay respects.

The Koreas have technically been in a state of war for nearly 60 years because the Korean War ended in 1953 with a truce and not a peace treaty. The last reunions of Korean families pulled apart by that war were held in 2010.

Under Kim Jong Un, Kim Jong Il's son, North Korea has pursued both nuclear weapons and economic development as top priorities. In a Memorial Day speech earlier Thursday, President Park repeated her criticism of that stance, saying the two goals can't be achieved simultaneously. But she also called on North Korea to come to talks with Seoul to build trust.

The North has established economic development zones at Kaesong and near the Chinese border in Rason to pursue foreign investment. On Wednesday, the North's official Korean Central News Agency announced that the country had passed a law allowing for the creating of new economic development zones open to foreign investors. It wasn't clear where those zones would be set up.