Kaesong firms report hard times

According to Yonahp:

South Korean firms operating at an inter-Korean industrial complex have asked the government to grant a grace period for their debt repayments, saying the two Koreas’ strained political relations have adversely affected their business, officials at the complex said Wednesday.

The officials said an association of South Korean firms at the factory park collected signatures from some 40 firms operating there and submitted the request to the Ministry of Unification last week. The ministry is tasked with handling inter-Korean affairs.

“Although the total amount of production at the complex has increased this year, about 30 percent of our firms are experiencing significant difficulties,” said one of the officials, who wished to remain unidentified.

In the letter, the firms said their businesses are struggling due to the months-long political standoff triggered by North Korea’s deadly military attacks against the South last year. Seoul suspended nearly all ties with Pyongyang last year over the March sinking of the South Korean warship Cheonan and the artillery shelling of the front-line island Yeonpyeong, which killed a total of 50 South Koreans.

“With a growing number of firms facing the risk of bankruptcy, (we) need emergency measures from financial institutions, including an extension of grace periods and the deferral of debt repayments,” the firms said in the letter.

The association sent a similar request to Rep. Park Joo-sun of the main opposition Democratic Party last week, prompting lawmakers from a special parliamentary committee on inter-Korean relations to plan a trip to the joint industrial zone. The visit was canceled, however, after the Unification Ministry effectively denied their entry. All trips to North Korea are subject to prior approval from the ministry, as the Koreas remain in a technical state of war following a cease-fire at the end of the 1950-53 Korean War.

The industrial complex in the North Korean border city of Kaesong, an achievement of the first-ever inter-Korean summit in Pyongyang in 2000, combines South Korea’s capital and technology with the North’s cheap labor to produce clothes, utensils, watches and other goods.

Read previous stories on the Kaesong Industrial Zone here.

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Kaesong firms request deferral of debt repayments


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