NK Makes `Outrageous` Demands on Biz Park

North Korea yesterday demanded higher pay raises for North Korean workers at the Kaesong industrial park and exorbitant rent for use of the first-stage complex in the park.

The North delivered the demands at its second working-level talks with South Korea at the Inter-Korean Exchanges and Cooperation Consultation Office in the business complex.

Pyongyang demanded a monthly wage of 300 U.S. dollars per worker and a rise in the rent for 3.3 million square meters of the first-stage complex to 500 million dollars.

The North also will seek annual salary raises of 10 to 20 percent instead of five percent.

The rent demand is 31 times the amount South Korea’s Hyundai Asan Corp. and the (South) Korea Land Corp. paid in 2004 for the same area (16 million dollars).

A Seoul official said, “What North Korea wants is unacceptable for Korean companies operating there. This seems to be a bargaining chip for future negotiations.”

The two Koreas will hold a third round of working-level talks in Kaesong. Seoul senses that Pyongyang could change certain demands in follow-up negotiations.

If the North sticks to its demands, however, many South Korean companies will likely move out of the complex. Additional South Korean financial support to such companies is also expected to trigger controversy.

The detention of the Hyundai Asan worker entered its 74th day, yet the North gave no advance response on the matter. For this reason, critics say Seoul simply returned with Pyongyang’s outrageous demands and no progress in guaranteeing the safety of South Koreans in the North.

kyle@donga.com