North Korea has said it will withdraw all its workers from the Kaesong industrial complex run jointly with South Korea, and temporarily suspend all operations there.
Since Wednesday North Korea has refused to let in South Korean managers and trucks bearing food, materials, and supplies, Business Insider reports.
North Korea's state broadcaster KCNA quoted Kim Yang Gon, secretary of the Central Committee of the Workers' Party, as saying:
The Kaesong industrial zone is a large complex within North Korea, managed by South Koreans and staffed mainly by North Koreans.
Conceived following the historic 2000 summit between late North Korean leader Kim Jong-il and late South Korean President Kim Dae-jung as an attempt to bolster economic ties between the two countries, the first factory opened in 2004.
Today, more than 120 South Korean manufacturers have factories in Kaesong, attracted by the cheaper labour and tax breaks.
Goods made there range from shoes, clothes, make-up and kitchenware to watches and cars.
The zone employs more than 50,000 low-wage North Korean labourers, and up to 1,000 South Koreans.
North Korea earns approximately, $2 billion (£1.3 billion) in trade annually from the complex, according to the South.
North Korea also directly collects the wages of its workers, earning more than $80 million (£52 million) annually from their labour.
While North Korea has shut the Kaesong border before, the park itself has never formally stopped operations.