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RPT-UPDATE 1-S.Korea says talking best way to curb labour woes

(Repeats to add dropped word in first paragraph)

SEOUL, June 25 (Reuters) - South Korea's government, facing industrial unrest across a range of industries and criticism over its handling of recent disputes, said on Wednesday it would stick to a policy of trying to resolve labour problems using dialogue.

Prime Minister Goh Kun, who said those leading illegal strikes would be held responsible, gave little hint of a change in labour policies after an emergency meeting of top ministers.

"The government's basic principle toward labour-management relations lies on the fact that we will seek to solve problems through dialogue and compromise between the labour and management," Goh said in a countrywide televised speech.

The meeting came a day after the 39,000-strong union at the country's top auto maker, Hyundai Motor Co , voted to strike over its claim for higher wage increases. The union did not say when it would launch industrial action.

Analysts were unimpressed by Goh's speech.

"The government still seems to have no firm principle in dealing with labour issues," said Cho Duk-hyun, an analyst at Hanwha Securities.

Meanwhile, the country's second-largest union umbrella group, the Korean Confederation of Trade Unions, has said about 100,000 workers will down tools for four hours on Wednesday, while 22,000 unionised rail workers are due to strike from Saturday.

The stock market has fallen recently on fears about spreading labour unrest, although was trading slightly up on Wednesday.

The benchmark stock index , which has lost nearly four percent over the previous three days, was up 0.8 percent by mid morning.

With the economy already on the verge of entering its first recession in five years, more industrial disruption would dismay authorities and investors -- especially as a sovereign rating review by Fitch Ratings is due to begin on Wednesday.

Analysts and fund managers have criticised President Roh Moo-hyun, a former labour lawyer, and his four-month-old government for not taking a firmer line on labour, arguing it has emboldened unions to demand higher pay and to block structural reforms potentially requiring layoffs.

Roh's government was involved in a deal at the weekend to delay for at least three years a merger between two banks, caving into a four-day strike by unionised workers at Chohung Bank . The government had earlier called the strike illegal.

Roh said authorities had been right to intervene, arguing the government and public would have paid a high price if the strike had dragged on.

Earlier, threats of a strike by unionised rail workers had led the government to scrap a plan to privatise some railway operations, and truck drivers in the country's largest port city won higher payments and other benefits after a strike.