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What Will Become of the Inter-Korean Biz Complex?

Posted May. 28, 2009 08:06,   


The inter-Korean industrial complex in the North Korean border city of Kaesong is in limbo amid the latest threats from North Korea against South Korea.

If the South pulls out its workers in Kaesong, the North could shut down the complex. If the staff are left there, they could be held hostage. In short, Seoul is stuck between a rock and a hard place.

The North halted the passage of South Koreans to the complex in March in protest of the South Korea-U.S. military drill Key Resolve and took South Koreans in the complex as de facto hostage. Hence, Seoul is deciding whether the complex or the safety of South Korean workers there is more important.

A senior South Korean official said yesterday, “In the event of a military confrontation such as battles in the Yellow Sea, the South must seriously consider pulling out South Koreans from the complex.”

The Unification Ministry in Seoul has reportedly requested companies operating in Kaesong to leave a minimal number of staff who are absolutely essential to operations and withdraw all others.

This means Seoul remains undecided over pulling all South Koreans from the complex, as the North has yet to take an act of aggression against the South.

The North indicated that it will continue allowing inland passages of people through the border and ship operations through yesterday morning.

Ministry spokesman Chun Hae-sung said, “The North sent approval for normal inland passages of people via the Gyeongeui Line at 7:50 a.m.,” adding, “South Koreans are continuing to visit the North under the normal process.”

The North, however, has raised jitters by repeatedly claiming through media outlets around the time of its second nuclear test that the South is responsible for the crisis at the industrial complex.

With Our Own People, an online publication in the North, said yesterday, “(The South) has a shrewd plot to shut down the Kaesong industrial complex on the pretext of a South Korean worker detained at the complex, and to hold us accountable.”

While hinting at the possible closure of the complex, the North thus expressed its intent to hold the South responsible if the facility is closed.

Amid the North’s string of aggressive acts, South Korean companies operating in Kaesong are striving to cope with the situation, including preparing for a pullout of their workers.

One company CEO said, “I understand that certain companies that entered the complex have belatedly begun preparation to withdraw staff and find an alternative plant site after suffering from chronic operational deficits.”

Another company source said, “Rumors are circulating that North Korea could take steps to halt passage to and from the Kaesong complex,” adding, “If that happens, small-size companies lacking competitiveness will be forced to leave the complex.”

Lee Im-dong, director-general at the Association of Kaesong Industrial Complex Companies, expressed a cautious stance on the situation, saying, “The North in principle wants to maintain the complex.”

Yesterday, 407 South Koreans visited the complex while 440 returned to the South. The number of South Koreans still in the North was 1,096 as of yesterday afternoon.

spear@donga.com sukim@donga.com