North and South Korea move closer to reopening joint industrial park


Kim Ki-Woong, right, Director-General, Inter-Korean District Support Directorate, and North Korean counterpart Park Chul-Soo, left, shake hands after their meeting at the Kaeseong Industrial Complex in North Korea on Aug. 14. (Korea Pool/Handout/EPA)
August 14, 2013

North and South Korea made significant progress Wednesday toward reopening their jointly operated border industrial park, a turning point — after weeks of fruitless talks — that South Korean President Park Geun-hye called a potential “new start” for relations between the neighbors.

After their latest round of talks, the two Koreas released a statement saying they would aim for “normalization” of the Kaesong Industrial Complex, which was blockaded and then shut down by the North four months ago during a period of high tensions.

The agreement is hardly conclusive, requiring further sit-downs and leaving the potential for pitfalls, analysts said. But it marked the clearest sign yet that the North and South, despite trading harsh threats in the spring, want to cooperate with each other in limited ways.

If Kaesong resumes operations, it would provide a foundation for Park’s “Trustpolitik” strategy, which calls for building inter-Korean ties and deepening cooperation — but only if Pyongyang proves itself worthy of trust.

In talks Wednesday, the North appeared to make an important concession, guaranteeing the future operation of the plant regardless of the “political situation.” South Korean negotiators, entering what they described as a final round of talks, had spent more than 50 hours — over six meetings — pressing for such an assurance. The South had said that it would not agree to Kaesong’s reopening unless Pyongyang pledged that it would not again unilaterally shutter the plant.

The wording in the joint statement was vague and did not directly blame the North for the April shutdown. But it said both the “South and North” would guarantee the zone’s “normal operation.” Notably, the two Koreas also agreed that the park should host foreign investors — a step that South Korean officials believe will make it more difficult for the North to close the park at the whims of its leadership. One of South Korea’s negotiators, Kim Ki-woong, called the statement “not the end but a beginning.”

The Kaesong complex, which pairs small- and medium-size South Korean businesses with cheap North Korean labor, opened about nine years ago as the showpiece of a more optimistic time. South Korean leaders hoped that Kaesong, a bubble of capitalism six miles north of the demilitarized border, could spur broader liberalization in the North.

That has not happened, but the North Korean government does depend on Kaesong for an estimated $80 million, mostly culled from the salaries of its workers. Kaesong has become, instead, a symbol of the strange and limited interaction between the North and the South. At the 800-acre site, North Korean propaganda music plays through loudspeakers. South Korea provides the technical know-how, the electricity and even the food for workers — two meals per day and several snacks.

In the four months since Kaesong fell idle, equipment has been damaged by the summer humidity, about 53,000 North Koreans have been out of work, and the 123 South Korean companies at the park have lost nearly $1 billion.

Some analysts have said that Kaesong’s resumption is critical for a different reason: It will prove that the Koreas are willing to deal with each other.

That has not been the case for much of the past five years, with conservatives in office in Seoul. Under Lee Myung-bak, South Korea’s president from 2008 until earlier this year, the South halted the free-flowing aid to its impoverished neighbor, saying a resumption depended on the North’s denuclearization. The North responded with fury. Its state media made assassination threats against Lee, and the North twice carried out fatal attacks on the South. By the end of Lee’s tenure, the two Koreas had cut off nearly all meetings, tours and trade — except Kaesong.

Park, beginning a five-year term, took office in February looking for a middle ground between the unrequited friendship offered by liberal presidents and the hard line of Lee. During her trip to Washington in May, Park told Congress that she wanted to build trust with the North through exchanges and cooperation, leading the way to a peaceful reunification. “But as we say in Korea, it takes two hands to clap,” she said. “Trust is not something that can be imposed on another.”

Park’s strategy has proven popular; her approval rating is near 60 percent. She is also calculating, analysts say, that the North feels increasing pressure to improve ties with the South. Aid and trade would help the North’s decrepit state-run economy while also counterbalancing its heavy reliance on China. Tellingly, North Korean state media have made only a few nasty quips about Park — a change from the coverage about Lee, who was pilloried almost daily.

Pushing Park away at this stage would mean “the continuation of another four-plus years of a cold shoulder,” said Scott Snyder, senior fellow for Korea studies at the Council on Foreign Relations. “Frankly, given North Korea’s tangible [economic] circumstances, to shut that door would mean some significant consequences.”

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