Seoul , South Korea ( CNN ) -- South Korea has denounced a policy that called for a peaceful engagement with North Korea as a failure . An annual white paper published by Seoul 's Ministry of Unification slammed the decade-long engagement policy , which cost South Korea $ 4.5 billion . The policy did not change North Korea 's `` perverse '' policies , the report said Wednesday . `` Despite outward development over the past decade , inter-Korean relations have been under criticism from the public in terms of quality and process , '' the Chosun Ilbo newspaper quoted the white paper as saying . `` They have in fact become increasingly disillusioned with the North and more worried about security as the North continued its nuclear arms program . '' The sinking of the South Korean warship , the Cheonan , which killed 46 sailors earlier this year , showed that the North is `` ... consistently maintaining a reunification doctrine based on a strategy to turn the entire Korean Peninsula communist despite its outward policy in favor of cooperation and reconciliation . '' The ministry confirmed the newspaper report . The Sunshine Policy is based on the Aesop fable of a warm sun forcing a man to divest his coat after a cold wind had failed to do so . It lasted between 1998 and 2008 . It overturned decades of containment , but was reversed when the conservative Lee Myung-bak government took power in Seoul in 2008 . `` This government has more focus on principle-based exchange and cooperation , '' said deputy spokeswoman Moon Jong-woo of the unification ministry . `` We want to promote peace and security through inter-Korean relations -- that is the all-time goal . '' While current relations between the two Koreas have been cold since the Lee government took office , and have been icy since the naval sinking this March , there were significant tensions even at the height of `` sunshine '' -- including North Korean nuclear and missile tests , and two fatal naval clashes . The Sunshine Policy resulted , however , in the establishment of an enclave for Southern tourists in North Korea at Mount Kumgang and two inter-Korean summits . The tourist enclave has been closed since 2008 when a southern tourist was shot there by a Northern soldier . Today , the last tangible relic of `` sunshine '' is the Kaesong Industrial Zone , a factory park just inside North Korean where 110 Southern firms employ more than 40,000 North Korean workers . Some pundits say Seoul 's 1998-2008 engagement policy was undermined by fractures in the Korea-US alliance . `` You had the most liberal presidents ever in Korea at the time of a very vigorously conservative American president who thought that accommodating the North Koreans was not the way to go , '' said Mike Breen , a biographer of North Korea 's leader Kim Jong-il . Today Seoul 's policy aims are clear , their outcome even less so . `` I would say that the current South Korean policy is based on the denuclearization and the openness of North Korea , '' said Dr Choi Jin-wook , of the Korea Institute for National Unification . `` The major critique of this policy is that it is naive . '' Although the six-party talks on North Korean denuclearization are in limbo , Seoul maintains some channels of communications with the Pyongyang . The unification ministry announced on Thursday that the South would attend Red Cross talks with the North on humanitarian issues and on the resumption of inter-Korean tourism projects . And `` sunshine '' did have some lasting benefits . `` It did not have any concrete results , but it helped South Koreans overcome the shortcomings of their anti-communist education , '' Breen said .
An annual white paper slams the decade-long engagement policy . It did not change North Korea 's `` perverse '' policies , the report says . The Sunshine Policy lasted between 1998 and 2008 .