|
November 17, 2009
|
|
| The South Korean government announced yesterday it will provide financial aid for struggling South Korean firms in North Korea’s Kaesong Industrial Complex and will give companies more time to repay loans. The Unification Ministry said the government will assist South Korean companies that experienced financial hardship after North Korea imposed cross-border travel restrictions last December. Ministry spokesman Chun Hae-sung said 20 companies will receive about 6 billion won ($5.2 million) in grants. All 20 companies began operating in Kaesong in the latter half of 2008 or later, Chun added. On Dec. 1 last year, North Korea lowered the maximum number of South Koreans and their vehicles permitted to travel to the North each day in protest of Seoul’s tough stance on Pyongyang. The Lee Myung-bak government suspended unconditional rice and fertilizer aid and instead linked assistance packages to the North’s denuclearization efforts. The restrictions dealt a big blow to inter-Korean businesses. South Korean companies either scaled down their operations or withdrew altogether from the Kaesong complex, which was built in 2003 as a symbol of cooperation and reconciliation. More than 100 South Korean companies employ about 38,000 North Korean workers. The North eased these restrictive measures in August. In another move to assist South Korean firms, Chun said 28 companies that have had difficulty repaying their debts due to financial difficulties will receive a six-month grace period. “Following our study into the state of South Korean companies in Kaesong [in June], we learned that the North’s border restrictions had a negative effect on production, which led to financial difficulties,” Chun said. “We expect our assistance to alleviate at least some of [the companies’] problems.” South Korean companies in Kaesong have been affected by other inter-Korean issues. In June, with tension on the peninsula at its peak, the North demanded the monthly wage for North Korean workers in Kaesong be raised from $55 to $300. It also insisted the South pay $500 million for 330 hectares (815.4 acres) of land in Kaesong even though Seoul had already paid $16 million to use the real estate there. Pyongyang dropped the wage claim in September but has made no reference to land use fees since the summer. Inter-Korean relations have been on a roller-coaster ride this year. The North has conducted a nuclear test and fired a slew of missiles. But it has also agreed to reopen the border for the suspended tourism programs and staged family reunions at Mount Kumgang in the fall. By Yoo Jee-ho [jeeho@joongang.co.kr] |
|
