Expansion of Kaesong Site to Resume by April

Korea Times
Lee Jin-woo
2/20/2007

Unification Minister Lee Jae-joung said Tuesday the ministry would resume the halted expansion of a joint industrial complex in the North Korean city of Kaesong no later than mid-April.

Last September, the South Korean government decided to hold off expanding the Kaesong complex because of heightened tension on the Korean Peninsula after the North’s test-firing of seven missiles in July. After Pyongyang’s first-ever underground nuclear test on Oct. 9, tensions increased further.

Minister Lee had been negative about the expansion of the joint business venture, saying more progress in the six-party talks as a prerequisite condition to proceed with the plan.

“We’ve already completed preparing some 3.3 million square meters of land there with almost perfect water and electricity supply,” Lee said in a press briefing at the ministry in Seoul. “Considering its important role for small- and medium-sized South Korean companies, I believe we should resume the expansion plan late next month or mid-April at the latest.”

The Kaesong site is one of two major cross-border projects South Korea has kept afloat despite the chilly inter-Korean relations. The two Koreas are also runing a joint tourism project at Mt. Kumgang in North Korea.

When fully expanded by 2012, the complex is expected to house about 2,000 South Korean manufacturers employing about half a million North Koreans, according to the Ministry of Unification.

The minister also said another inter-Korean summit would be a very useful tool to boost a more reconciliatory atmosphere on the Korean Peninsula, but said the government is not making any efforts to prepare for one.

“Just like the historic summit in June 2000 did, another inter-Korean summit would play a crucial role in bringing peace and prosperity between the two Koreas without a doubt,” Lee said.

“However, an agreement between the leaders of the two Koreas is necessary to realize another summit. We’re not currently working on the issue with North Korea.”

Lee also said South and North Korea should play a leading role in forming a separate peace forum among nations participating in the nuclear disarmament talks. The establishment of the peace forum was mentioned in an agreement made in Sept. 19, 2005, which laid out the course for North Korea’s eventual denuclearization.

“I’m not sure exactly how many nations will take part in the forum to guarantee peace on the Korean Peninsula. It could be four including the two Koreas, the United States and China,” Lee said. “However, Seoul and Pyongyang should play a leading role in preparing the forum.”

Lee said, if last week’s agreement in the six-party talks is carried out as planned, the two Koreas should begin to set up the peace forum at the same time.

On Feb. 13, the North pledged to take the first steps toward dismantling its nuclear program in return for energy aid and other humanitarian assistance during the six-party talks.

Land for S. Korean companies in Kaesong complex on sale next month: ministry
Yonhap

2/20/2007

South Korea’s Unification Ministry said Tuesday that it plans to parcel out a 530,000-pyeong lot for South Korean manufacturers in the inter-Korean industrial complex in Kaesong late next month. One pyeong is 3.3 square meters.

The land is the remainder of the 1-million-pyeong lot which the South and North Korean governments have been jointly developing in the western North Korean border town in the first phase of the inter-Korean project which is to construct a 20-million-pyeong industrial base for South Korean companies by 2012. The complex, if completed, is expected to employ as many as half a million North Korean workers for some 2,000-3,000 South Korean manufacturers.

The government originally planned to sell the lot in three stages last year, but had to put it off amid inter-Korean tension caused by the North’s missile and nuclear tests.

“I believe it’s proper to sell the lot as early as the end of next month,” Unification Minister Lee Jae-joung said, citing his report submitted to President Roh Moo-hyun on Feb. 6 on his agency’s business for this year.

The Kaesong Industrial Complex is one of the two major cross-border projects that South Korea has kept afloat in spite of U.S. opposition. The two Koreas also run a joint tourism project at the North’s scenic Mount Geumgang.

In the industrial complex, South Korean businesses use cheap but skilled North Korean labor to produce goods. Currently, 21 labor-intensive South Korean factories employ about 11,160 North Korean workers.

But U.S. hard-liners criticize the complex, claiming that the factories where North Korean workers earn about US$60 per month are actually channels to funnel much-needed hard currency to the tyrannical North Korean regime.

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