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Energy Aid for the North Could Cost South Korea Trillions

Energy Aid for the North Could Cost South Korea Trillions

Posted September. 23, 2005 07:33,   


Compensation for North Korea’s renunciation of nuclear programs, including electricity, energy, and the provision of light water reactors could cost the South Korean government 6.5 to 11 trillion won over nine to 13 years, South Korean Unification Minister Chung Dong-young said on Thursday.

His remark came at the parliamentary inspection of his ministry by the Unification, Foreign Affairs, and Trade Committee of the National Assembly. “The government is reviewing how much costs it should cover by taking into account our economic situation and our position as a leading player in the Korean Peninsula issue,” he said on the question about South Korea’s share of the total cost for implementing the joint statement from the six party talks recently concluded.

Completion of light water reactors for North Korea, if approved by other parties of the six nation talks, may take 10 years, and expenditure for electricity supply during the interim may amount to 8 trillion won, Chung estimated. The South Korean government proposed to send two million kilowatts of electricity annually to its northern neighbor earlier this year if it abandons its nuclear ambitions.

The construction of transmission facilities, including reverse-current circuit brakes, transformer substations, and power lines, will cost an additional 1.7 trillion won, raising the total cost for implementing the proposal to a massive 9.72 trillion won.

Up to now, the South Korean government has argued that supplying power to the North would cost 1.5 trillion or so. Criticism is warranted for the government for its failure to make even a close calculation for the cost of its proposal that will impose a heavy burden on people.

If it takes three years for North Korea to complete its nuclear dismantlement, the South Korean government may have to spend 150 billion won for heavy oil aid during that time. For light water reactor construction, the South’s share of the cost is estimated to be as much as one trillion won.

However, the ministry’s estimate of a total of 11 trillion won does not include the 1.2 trillion won the government has already spent on the construction of a light water reactor in the North Korean city of Shinpo (a project that was agreed to at the 1994 Geneva Accords), and compensation to pay the North for its loss of power supply capacity when the project was completed. Accordingly, the final cost for the South Korean government could rise to 13 trillion won.

In the meantime, during the National Assembly’s inspection, Minister Chung remarked about repatriation of North Korean long-term prisoners, saying, “On humanitarian grounds, I am willing to consider sending them back if they want.”