Joint Korea factory complex raises output despite tensions

Output at a joint Korean industrial complex in North Korea rose 26% last year compared with a year earlier despite raised tensions on the divided peninsula, South Korea said Friday.

Production at the Kaesong park totalled $323 million, with growth seen in areas such as textiles, chemicals, machinery, electronics, food, paper and timber, a unification ministry official told reporters in Seoul.

The rise in production came despite a hike in tensions last year after South Korea accused the North of sinking one of its warships and the North bombarded a South Korean island.

Pyongyang denies sinking the ship and says it was provoked into shelling the island.

The North also raised international security concerns by announcing big advances in its nuclear programme.

More than 46,000 North Koreans work at the complex in the border town of Kaesong, providing cheap labour for more than 120 South Korean firms that produce goods such as clothes, utensils and watches.

Construction on the project began in 2003 as a model of future economic cooperation between the two states, which are technically at war because they have signed no formal peace treaty to end their 1950-53 conflict.