S. Korea proposes new talks with N. Korea on Kaesong

South Korea on Thursday proposed fresh talks with North Korea aimed at re-opening a shuttered joint industrial zone at Kaesong, a government spokesman said.

The Unification Ministry sent a message to the North Korean government proposing that three officials from each side meet at the border truce village of Panmunjom on Saturday, spokesman Kim Hyung-Seok said.

"The two sides would be able to discuss the issue of checking on facilities and equipment... and the issue of reopening the Kaesong industrial district," Kim said.

The proposal came a day after North Korea restored a cross-border hotline and announced it would let the South's businessmen and managers visit the zone to check on mothballed facilities.

Professor Kim Yong-Hyun of Korea University said the North was likely to come to the dialogue table over Kaesong as it seeks to improve living standards of its impoverished population and attract foreign investment in special economic zones.

The Kaesong estate, where North Koreans work in Seoul-owned factories, was the most high-profile casualty of the months of elevated tensions that followed the North's nuclear test in February.

Operations at the Seoul-invested industrial estate in the North came to a halt after Pyongyang banned entry by the South's factory managers and other officials and pulled all North Korean workers out in April.

North Korea turned a deaf ear to a South Korean proposal for talks between government officials to discuss the reopening of the zone.

As tensions began easing last month, however, the North restored the hotline and suggested a high-level meeting to discuss not only Kaesong but other suspended inter-Korean economic and social exchanges.

But plans for the talks collapsed due to disputes over protocol and the hotline was switched off again.

The North's turnaround on Wednesday came hours after dozens of South Korean firms threatened to withdraw from the zone, complaining they had fallen victim to political bickering between the two rivals.

Kaesong was established in 2004 as a rare symbol of cross-border cooperation, with some 53,000 North Koreans working for 123 South Korean firms in recent months.

It was an important hard currency source for the impoverished North, mainly through its cut of workers' wages.

Neither side has declared the complex officially closed despite the paralysis for the past three months, calling it a temporary shutdown.

Representatives of the South Korean companies have repeatedly urged the two sides to open talks to revive the moribund industrial park.

Of them, 46 are manufacturers of electronics and machinery parts whose facilities are especially vulnerable to humidity in the current wet weather.