Nov. 11 (Bloomberg) -- South Korea approved border crossings into North Korea for business and tourism, seeking to calm tensions stoked by the first naval clash between the two countries in seven years.

Visits to jointly-run factories and tourism areas in North Korea proceeded as normal, Unification Ministry spokesman Chun Hae Sung told reporters today in Seoul. A merchant vessel digging for sand west of the Korean peninsula returned to South Korean waters and two non-government groups providing aid to North Korea canceled visits amid security concerns, Chun said.

“The government will take all measures for security” to prevent people from being nervous, the Presidential Office said in an e-mailed statement. “Still, we don’t want the relationship with the North to deteriorate.”

South Korea’s actions may be designed to defuse tension with its communist neighbor ahead of a visit to Seoul next week by President Barack Obama. Defense Minister Kim Tae Young expressed concern North Korea would retaliate because its warship was damaged in yesterday’s firefight.

South Korean army, navy and air forces are closely monitoring the activities of North Korean troops, a spokesman for the Joint Chiefs of Staff said. The military deployed two additional warships close enough to the border to deal with any emergency, Yonhap News reported.

South Korea’s Kospi stock index climbed 0.8 percent to close at the highest since Oct. 28. The Korean won rose against the dollar, nearing a 13-month high.

North Korea said yesterday its patrol ship was attacked by South Korean warships while on “routine guard duty” in its own waters, and demanded an apology.

To contact the reporter on this story: Sangim Han in Seoul at sihan@bloomberg.net

Last Updated: November 11, 2009 02:41 EST