North Korea said Thursday it will expel all South Korean nationals from a joint industrial park in the North and freeze all assets of South Korean firms operating there in retaliation for Seoul's suspension of the complex.

The North has ordered all South Koreans to immediately leave the Kaesong Industrial Complex in the North's border city, according to a statement issued by the Committee for the Peaceful Reunification of Korea, which handles inter-Korean affairs.

It said that it will freeze all assets including equipment and products made by South Korean companies, adding that it has closed the complex and designated it a military zone. The two Inter-Korean communication hotlines will be also cut off, it added.

The North's announcement came one day after South Korea announced plans to shut down the factory zone, the last remaining symbol of inter-Korean reconciliation, in response to the North's latest nuclear test and long-range rocket launch.

Seoul's move is part of its "bone-numbing" measures against North Korea's nuclear test on Jan. 6 and its long-range missile launch earlier this week.

On Sunday, the North launched a long-range rocket carrying a satellite, which Seoul and Washington view as a cover for a banned test of intercontinental ballistic technology.

South Korea "will experience what disastrous and painful consequences will be entailed by its actions," the North's committee said.

A total of 124 South Korean companies are operating in the zone, some 50 kilometers northwest of Seoul, employing more than 54,000 North Korean workers to produce labor-intensive goods, such as clothes and utensils.

The complex, opened in 2004, has served as a major revenue source for the cash-strapped North, while South Korea has benefited from cheap but skilled North Korean labor. The South Korean firms annually provide about US$100 million in total to North Korean workers for wage. (Yonhap)