The top South Korean official charged with handling North-South relations says the time has come for South Korean workers still at the shuttered Kaesong factory zone to return home.
Unification Minister Ryoo Kihl-jae said Friday that the government has made an "unavoidable decision" to bring about 180 South Korean workers home.
The decision came hours after North Korea rejected the South's proposal for formal negotiations to restart operations at the Kaesong complex.
Seoul gave Pyongyang 24 hours on Thursday to agree to talks, warning of a tough response if Pyongyang did not agree to the offer.
Hours after the deadline passed Friday, Pyongyang dismissed the offer and warned that it would be the first to take tough action if the South insists on worsening the situation at the border town.
South Korean President Park Geun-hye met with her security-related Cabinet ministers on Friday, regarding fate of the Kaesong complex.
Operations at Kaesong, just north of the border, have been suspended since North Korea angrily pulled its workers and blocked South Korean access to the center earlier this month.
About 180 South Koreans remain there in hopes that production can resume, but they are thought to be quickly running out of food and supplies.
Kaesong is the last remaining symbol of cooperation between the two foes, and is seen as a bellwether of Korean relations. Although work at the center has been suspended during times of heightened tensions, it has never been shut down completely since it was established in 2004.
Though Pyongyang has refrained from making daily threats of violence against the South in recent days, tensions remain high on the Korean peninsula.
North Korea is angry over U.N. Security Council sanctions passed in response to Pyongyang's February nuclear test, as well as annual joint military exercises between South Korea and the United States.