North Korean leader Kim Jong-un has ordered the pulling down of facilities built by South Korea at the Kumgangsan tourist resort, amid stalled inter-Korean diplomacy.

According to the North’s official newspaper Rodong Sinmun and the Korean Central News Agency on Wednesday, the North Korean leader visited Kosong Port, Haegumgang Hotel, the House of Culture, Kumgangsan Hotel, Kumgangsan Okryu Restaurant, Kumgang Pension Town, Kuryong Village, Onchon Village, Family Hotel, Onjong Pavilion No. 2 and Kosong Port Golf Course on the east coast this week.

“He instructed to remove all the unpleasant-looking facilities of the south side with an agreement with the relevant unit of the south side and to build new modern service facilities our own way that go well with the natural scenery of Mt. Kumgang,” the KCNA said.

Kim also said it was “a mistaken idea and a misguided understanding” for the resort to be deemed the common property of the two Koreas, given that the site is on the North’s soil.

In September last year, President Moon Jae-in and Kim agreed to normalize the now-shuttered Kumgangsan tourism and Kaesong industrial park projects when conditions mature.

But the prospects of that happening were clouded by a second summit between Kim and US President Donald Trump in February, which failed to yield results on the North’s denuclearization and corresponding measures from the US.

South Korea’s Unification Ministry said it was open to discussion with the North at any time to advance “the protection of the property rights of our people, the spirit of the inter-Korean agreement, and the resumption and revitalization of Kumgangsan tourism.”

“North Korea seems to have decided to take stronger action as the South is not making any moves despite its hope that it will put efforts to resume the tourism project as it is not subject to international sanctions,” said Park Won-gon, a professor of international politics at Handong Global University.

In a New Year’s speech, Kim said Pyongyang was ready to restart the projects “without any preconditions.”

The South began tours to Kumgangsan in 1998 but suspended them after a South Korean tourist was shot dead by a North Korean soldier in 2008, purportedly for entering a military zone.

The majority of South Korean facilities at the resort were built by Hyundai Asan. The North Korean leader’s father, Kim Jong-il, granted the company exclusive rights to operate it until 2030.

The investment in the resort by Hyundai Asan totals 767 billion won ($654 million). Its lost revenue over the past 11 years from the suspension of the project is estimated at 1.6 trillion won.

“We are embarrassed by the sudden report in the situation where we are preparing for a resumption of tourism, but we will respond calmly,” the company said in a statement.

Hyundai Asan formed a task force in charge of the inter-Korean economic cooperation project after the Moon-Kim summit, held at the village of Panmunjom in April last year, led to a rapid thaw in inter-Korean relations.

Koh Yu-hwan, a professor of North Korean studies at Dongguk University, said the North Korean leader’s remarks show the country’s push toward “self-reliance” and its desire to enhance its tourism industry without external resources.

“One of the achievements that Kim Jong-un has made is establishing buildings and tourism spots. North Korea is gearing up to attract massive numbers of Chinese tourists to the spots,” Koh said.

Along with Kumgangsan, the regime is looking to develop the Wonsan Kalma coastal tourist area and the Masikryong Ski Resort as scenic spots to attract tourists.

By Park Han-na (hnpark@heraldcorp.com)