Page last updated at 05:21 GMT, Thursday, 21 January 2010
Some 40,000 North Koreans are employed at the Kaesong complex
North Korea and South Korea have made no significant progress in two days of talks about their jointly-run Kaesong industrial park.
They were expected to plan development of the project and set an agenda for future talks, but failed to do so.
No date was set for a future meeting, after the North wanted wage rises for the North Korean workforce on the agenda, South Korean officials said.
The industrial estate is intended as a symbol of cross-border cooperation. But it has also long highlighted differences between the two countries.
Unrest prediction
More than 110 small- to medium-sized South Korean companies use cheap North Korean labour at the factory park, just north of the border, to make products such as cooking pots, clothes, shoes and watches.
The complex has remained fully operational despite a range of disputes between the neighbours, providing the impoverished country with a key legitimate source of hard currency.
A South Korean think tank, the Korea Institute for National Unification, had predicted unrest and a military coup, popular uprising, a massacre or mass defections after North Korean leader Kim Jong Il dies.
Mr Kim, who turns 68 next month, is believed to have suffered a stroke in 2008. The think tank said he was not expected to survive past 2012.
Meanwhile, South Korea's Defence Minister Kim Tae-young called for a pre-emptive strike on North Korea if there is a clear indication the country is preparing a nuclear attack.
He made similar comments in 2008 when he was chairman of South Korea's Joint Chiefs of Staff, which prompted the North to threaten to destroy the South.
Multinational efforts are under way to persuade North Korea to return to six-party talks on ending its nuclear programme, so far in vain.
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