Recent moves to isolate DPRK don’t include Kaesong Industrial Zone

From Yonhap:

Seoul to expand inter-Korean economic project despite U.S. concerns: official

A ranking South Korean official on Wednesday said the government may expand a joint industrial complex in North Korea’s border town of Kaesong at an early date despite concerns that money paid to North Korean laborers there may be used to build missiles.

“The Kaesong industrial complex is a project that runs strictly on the mechanism of a market system,” Goh Gyeong-bin, head of the office for the inter-Korean economic project at the Unification Ministry, told reporters.

He said the government may begin the next phase of the Kaesong development project as early as August or September, which would include leasing out 1 million pyeong of land at the joint complex to South Korean companies. One pyeong equals 3.3 square meters.

The remarks are in line with Seoul’s earlier stance that it does not need to halt the inter-Korean project despite concerns, mainly from the United States, that wages paid to North Korean workers may be forfeited and diverted by Pyongyang to build missiles and weapons of mass destruction.

The apparent opposition from Washington, although still tacit, intensified after North Korea launched seven ballistic missiles, including a long-range Taepodong-2 believed capable of hitting the U.S. west coast, earlier in the month, while the U.N. Security Council unanimously approved a resolution prohibiting missile-related dealings with the North.

South Korea’s point man on North Korean affairs, Unification Minister Lee Jong-seok, however, has refused to halt or suspend the economic project with the communist state, claiming the U.N. resolution does not require his or any other country to cut normal, legal economic relations with the North.

“What the international community, including the U.S., is worried about is the North making or taking money through illegal means,” Lee told a National Assembly committee on Monday.

Currently, 13 South Korean companies are operating at the industrial complex, where about 7,800 North Korean laborers are getting paid US$57 a month on average, according to Goh.

The ministry official said there was no way of knowing for sure whether the North Korean government was taking any of the wages, but claimed it wasn’t happening.

“There is no possibility. The amount tells us that,” Goh told Yonhap News Agency in a later telephone interview.

“Even though North Korea is an extremely poor state, it would take at least 50,000 (South Korean) won (about $50) on average to feed a family of four for a month,” he claimed.

He said the South Korean companies are paying about $500,000 to $600,000 a month to 7,862 North Korean employees.

“The issue (of possible diversion of funds) may become significant when the amount grows to a significant level through second and third phases (of the development project), but it really is not an issue at this time,” he said in the press briefing.

Between 300 to 800 South Korean companies, depending on the size of each business, are expected to move into the joint complex when the next phase of the development plan is completed, according to Goh.

The industrial complex is expected to house about 2,000 South Korean companies employing nearly half a million North Koreans when it comes into full swing in 2012, according to the Unification Ministry.


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