Seoul minister rules out shutdown of Kaesong park

By Kim Hyun
SEOUL, May 18 (Yonhap) -- South Korea is not considering closing a joint
industrial venture in North Korea despite the "crisis" it faces after Pyongyang's
unilateral decision to scrap business contracts there, Seoul's unification
minister said Monday.
Seoul plans to make another offer for inter-Korean talks involving the Kaesong
complex, the last remaining reconciliatory project between the two sides, even
though North Korea has already rejected two earlier proposals, Hyun In-taek
said.
The joint venture in the North's border town of Kaesong is girding itself for
possible setbacks after North Korea announced it had canceled all inter-Korean
contracts regarding the complex and will unilaterally raise wages, land fees and
taxes. Pyongyang also told South Korean firms that would not accept the new terms
to leave.
"The Kaesong industrial complex is now at a critical juncture. But our government
will make utmost efforts to ensure its stable development," Hyun said in an
opening speech at a local forum.
He called the joint venture "the last-remaining hope for the future (of
inter-Korean ties) amid political and military rigidness."
The Kaesong complex, just an hour's drive from Seoul, opened in late 2004 as an
outcome of the first inter-Korean summit in 2000 between then South Korean
President Kim Dae-jung and North Korean leader Kim Jong-il.
More than 100 small South Korean firms operate in Kaesong, matching their capital
and technology with the cheap but skilled labor of nearly 40,000 North Korean
employees.
North Korea initially requested inter-Korean talks over the joint venture last
month, the first such proposal in more than a year. But the meeting on April 21
ended in less than half an hour due to tussling over the agenda, with North Korea
demanding wage hikes and contract revisions but refusing to discuss Seoul's
primary concern -- the fate of a detained South Korean worker at the complex.
The employee of Hyundai Asan Corp., the South Korean developer of the joint park,
was arrested in Kaesong on March 30 on charges of criticizing the North's
political system. North Korea has continued to deny Seoul access to the man,
identified only by his surname Yu.
Seoul proposed another meeting for last week, but the second round did not
materialize due to the agenda differences.
In Friday's statement, North Korea accused Seoul of delaying the meeting "over an
issue outside the agenda," referring to the matter of the detained worker.
Hyun reiterated Seoul's position that "the matter of Yu is a fundamental issue to
the Kaesong park" and will make another proposal for talks "at an appropriate
time."
Vice Unification Minister Hong Yang-ho plans to meet with representatives of
businesses operating at Kaesong later Monday to gauge their opinions. Lee
Im-dong, a member of the Kaesong Industrial Council, said, "Everything is
business as usual now, but there are concerns about the future."
Hong said in an interview with MBC radio that Seoul is "not considering a
shutdown" and that the joint venture "should be developed in a stable manner."
The joint venture has often fallen victim to souring political relations since
conservative South Korean President Lee Myung-bak took office in February last
year. Lee took a tougher stance on North Korea's nuclear program and ended the
unconditional flow of economic aid to the North supported by his liberal
predecessors for a decade.
North Korea has curtailed and sometimes banned South Korean traffic to the joint
venture in retaliation. Inter-Korean tour programs were shut down as relations
deteriorated last year.
hkim@yna.co.kr
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