S. Korean official says fate of Kaesong park depends on profitability

S. Korean official says fate of Kaesong park depends on profitability
SEOUL, June 27 (Yonhap) -- The fate of a joint industrial park in North Korea
will largely depend on whether it is economically sound and profitable for South
Korean businesses and their North Korean employees there, a ranking South Korean
official said Saturday.

The remarks from Vice Unification Minister Hong Yang-ho come as Seoul and
Pyongyang have been in negotiations over North Korea's recent demand for a
significant increase in rents and wages for North Korean workers at the
industrial park in Kaesong.
"It is important the current issues related to the Kaesong industrial complex are
resolved based on economic principles," Hong said in a speech delivered at the
district office of Dangjin, a port city located some 130 kilometers southwest of
Seoul.
"The industrial complex must be maintained and developed in a way that both the
South and the North can benefit from it and can help each other through the
project," Hong added.
In a June 19 meeting held at the North Korean border town, Pyongyang demanded
that South Korean firms there more than quadruple monthly wages for their North
Korean employees to an average US$300 from the current $70 to $80.
The North also demanded an additional $500 million for a 50-year lease on land at
Kaesong, for which it was paid an agreed upon $16 million when the park opened in
2004.
One of some 100 South Korean businesses at Kaesong has already withdrawn from the
complex while the others have rejected the North's demands, citing previous
agreements and the low productivity of North Korean workers.
Hong also linked the joint economic project to the North Korean nuclear issue,
saying denuclearization of North Korea was a key policy goal of Seoul that can
never be compromised.
bdk@yna.co.kr