The Kaesong complex is considered a key symbol of Seoul's engagement policy toward the North. It is a testing ground for mixing South Korean capitalism and technology with the North's cheap labor.

North Korean employees' wages in Kaesong amounted to $4.23 million in the second half of last year, up 48 percent from the first half's $2.87 million.

South Korea has recently begun preparations to expand the Kaesong complex. The government will conduct a geological survey of the land for a second stage of construction, officials said.

Capitalizing on Seoul’s excitement about the cross-border project, the North has demanded that South Korean visitors and residents in the Kaesong complex pay registration fees, ministry officials said.

"North Korea demanded fees for the issuance of registration to South Korean residents. They raised the issue in the process of working out details for stays and residence at the Kaesong complex," a ministry official said.

The official declined to disclose the amount of money proposed by the North, only saying there was a wide gap between the two sides.

Meanwhile, South Korea's ruling lawmakers are making a beeline to Kaesong in an apparent bid to burnish their "peace building" images ahead of the South's presidential elections this year.

A group of 20 lawmakers from the leftist Uri Party traveled to the complex on March 26 along with 60 other party and government officials.

Led by Party Chairman Chung Sye-Kyun, the lawmakers met North Korean officials and inspected the factories.

"The success of the Kaesong complex is necessary to peace and prosperity on the Korean peninsula,” Chung said in a speech. "The Kaesong project should be an unswerving policy," he said.

Uri Party officials said they also plan to arrange visits of U.S. lawmakers to the Kaesong complex to win their support. Some U.S. critics have said the Kaesong project has been used by the North to win much-needed hard currency.