North Korea Must Stop “Sucking the Gains” Out of Kaesung

Daily NK
Kim Song A

Will keeping the abandonment of Kaesung Industrial Complex in secret resolve anything?

It has been revealed that 4 out of 23 enterprises that were supposed to enter Kaesung Industrial Complex during the first rounds have abandoned their locations. Additionally, 4 other enterprises have placed their reservations on hold.

Since August 2005, there are only 7 companies which have commenced operations on the divided grounds of Kaesung Complex.

Of the remaining 8 enterprises which are undergoing the preparations for new constructions, 1~2 companies are considering renouncing their spots and are requesting that thorough investigations are made on Kaesung which now celebrates it’s 3rd anniversary.

In particular, affiliates of Kaesung have been carefully revealing the government’s recent strong ambition to complete the constructions for a 3,306 square km by the 30th of this month, initially a 1,750 square km, knowing that they could be severely affected.

However, the problem is that whenever these incidents occur, rather than finding ways to solve the issue, the government is wasting its efforts in keeping it a secret.

An employee working on Kaesung’s landscape revealed the following information in an interview with a reporter, “Supplementary areas are being designed. This is not advisable. It would be better to wait until the other constructions are complete.”

Despite contractors having to start construction within 6 months of signing a contract, it has now been 18 months and nothing has been begun, while fees for breach of contract are still being paid. No wonder enterprises have abandoned entering Kaesung Complex.

For the past 2 years, North Korea has had many opportunities to earn foreign currency through South Korean business and Kaesong. But the Korean government remains in futile and bewilderment.

Even today, South and North Korea have not been able to make complete amends regarding Kaesung Complex regarding work conditions, wages, entry and exit permits and inspections. Nonetheless, North Korea continues to make requests and one-sidedly takes action though the agreement has not yet been fulfilled.

The fact that North Korea has begun charging fees for issuing passports to long-term South Korean workers has still not been discussed, greatly caused by the government’s indolent preparatory measures.

Businesses are in a position where they cannot invest in Kaesung as know one knows what requests North Korea will make. Last week, 22 enterprises gathered in appeal against all the mishaps that had occurred and demanded that the government take action.

Above all, enterprises and NGO’s argue that North Korea must change its attitude towards the economic agreement. North Korea’s mentality is limited to “sucking the gains,” which has caused companies to leave the region, despite the advantages and the development potential of the Kaesung.

Furthermore, entrepreneurs argue that no matter how many laws are placed regarding Kaesung, North Korea will never change.

Regarding Kaesung, the South Korean government urges that “This is the future of small-medium sized businesses and the key to connecting the South and North for a peace industry.” Regardless, entrepreneurs contend that they will be unable to make any profits and argue that the “slogan is great but the content empty.”

While disregarding the concerns that “South Korea has been caught by North Korea” and hence is immobilized in the Kaesung’s preliminary measure, the South Korean government has arrived at this point. Though it is hard to make assumptions as Kaesung is still in its early stages.

However, the future of a unified Kaesung complex looks bleak as we are continuously faced with a situation where even work instructions are divided. The government should stop praising Kaesung as “hope” but realize and create another plan for entrepreneurs to be at ease and focus on business.


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