North Korea seeks talks with South but warns on sanction

By Rhee So-eui

SEOUL (Reuters) - North Korea made a rare proposal on Saturday for talks with the South over a joint industrial park just north of the border where the communist state has been holding a South Korean worker captive for weeks.

But it also issued a fresh warning against South Korea's move to join a U.S.-led initiative against the flow of weapons, saying any sanctions against the communist state would be considered an act of war.

The moves come after North Korea expelled international nuclear inspectors and threatened to restart its plant that makes arms-grade plutonium in response to being chastised by the United Nations for a rocket launch earlier this month widely seen as a disguised long-range missile test.

South Korea's unification ministry said North Korea wants to hold talks over the Kaesong industrial complex next Tuesday.

"We are considering the proposal," ministry spokesman Kim Ho-nyeon told a news briefing, without providing any details on the nature of the talks.

Ties between the rival Koreas have chilled over the past year due to Pyongyang's anger over the policies of President Lee Myung-bak, who took office a year ago and ended the South's free flow of unconditional aid to its impoverished neighbour.

Talks on Kaesong would be the first on economic matters between the two Koreas, technically still at war, since Lee took office in February 2008.

The Kaesong industrial park, once hailed as a model of economic cooperation, has been a focal point of conflict over the past few months with the North expelling South Korean workers therbe and clamping down on operations.