North Korea has vowed to immediately deport all South Korean nationals and freeze all South Korean assets at a jointly run factory park in the North.
Pyongyang said it was also pulling all its workers from the Kaesong complex, just across the tense border, in response to the South’s suspension of operations there following North Korea’s recent long-range rocket launch.
The North’s statement, by the Committee for the Peaceful Reunification of Korea, was issued through the Korean Central News Agency.
North Korea said the South’s shutdown announcement was a “dangerous declaration of war”.
Pyongyang also said it was shutting down two crucial cross-border communications hotlines and it was putting the factory under its military control.
The statement by the North significantly raises the stakes in a stand-off that began with North Korea’s nuclear test last month and rocket launch on Sunday.
North Korea, in its statement, issued crude insults against South Korea’s President Park Geun-hye, saying she masterminded the shutdown and calling her a “confrontational wicked woman” who lives upon “the groin of her American boss”.
The statement said the South Korean move was a “product of Park Geun-hye’s inveterate sycophancy and abnormal confrontational hysteria kicked off by her at the prodding of the United States”.
Seoul said it wants to stop Pyongyang from using hard currency from the park to develop its nuclear and missile programmes.
The closure is meant to punish North Korea for its launch of a rocket that the world sees as a banned test of ballistic missile technology.