ID :
56807
Wed, 04/22/2009 - 11:26
Auther :

(News Focus) Future of inter-Korean industrial zone in jeopardy


SEOUL, April 22 (Yonhap) -- South Korean firms operating at a joint complex in
North Korea indicated Wednesday they may rebuff the North's recent demand for
higher wages there.

At inter-Korean talks on Tuesday, which were delayed about 11 hours and ended
after 22 minutes, North Korea threatened to withdraw preferential contracts for
South Korean factories operating at the Kaesong Industrial Complex, which allow
cheap wages for North Korean workers and free land use.
In particular, a hefty hike in wages paid to North Korean workers could damage
the business rationale behind the Kaesong complex, which combines South Korean
capital with cheap North Korean labor, the chief executive of one of the firms
operating there said.
"The issue of wages brought up by the North is a very important issue," said Yoo
Chang-geun, the chief executive of SJ Tech Co. and vice chairman of a business
lobby representing about 100 South Korean firms in the North's border city of
Kaesong.
"If we are asked to raise wages, it will curb investment," Yoo said. "For
companies, it would be difficult to accept the demand."
As the talks ended, the South Korean government said in a press release that
North Korea "said it will reconsider all preferential treatment for the South at
Kaesong ... and called for the readjustment of wages for North Korean workers
there to a realistic level."
As of March, 101 South Korean factories operated in the complex, employing about
39,000 North Korean workers. The Kaesong park opened in 2005, and produces
labor-intensive goods such as clothing, kitchen wares and watches.
The South Korean firms have paid about US$75 to each North Korean employee per
month, including insurance payments, providing an essential source of hard
currency for the impoverished North.
The North's demand came as the fate of the Kaesong complex became more uncertain
due to heightened tension on the Korean Peninsula, following Pyongyang's April 5
rocket launch, which was unanimously condemned by the U.N. Security Council.
In response, North Korea expelled international nuclear inspectors and said it
was quitting the six-party nuclear disarmament talks.
To avoid any further provocations from the North, the South has delayed its
decision to become a full member of a U.S.-led drive aimed at halting the spread
of weapons of mass destruction.
Pyongyang has warned that Seoul's full participation in the Proliferation
Security Initiative (PSI) would be a "declaration of war."
Adding to the complexity surrounding the Kaesong zone, North Korea has detained a
South Korean employee from Hyundai Asan, which runs the industrial complex, for
nearly four weeks after accusing him of criticizing Pyongyang's political system
and trying to lure a North Korean female worker to defect to the South.
Pyongyang has refused to grant South Korean officials access to the detainee, a
man in his 40s who has been identified only by his surname Yu.
Still, few experts believed North Korea would shut down the Kaesong complex. But
critics said the facility, once hailed as a symbol of reconciliation between the
Cold War rivals, is increasingly becoming a pawn in the North's brinksmanship
diplomacy.
Operations have been already interrupted several times by North Korea's
intermittent border closures and its expulsion of South Korean officials in
protest of what it calls Seoul's "hostile" policy towards Pyongyang.
With long-term anxiety about the Kaesong complex mounting, the South Korean
government is under pressure from conservative media outlets here to take firm
action against the North.
"North Korea, while developing nuclear weapons and missiles over the past dozen
years or so, has often provoked the South and treated Seoul like an automatic
teller machine," an editorial in the Chosun Ilbo, South Korea's leading
newspaper, said on Wednesday
"One occasion it (the South Korean government) said PSI membership has nothing to
do with inter-Korean relations; on another occasion, it said it would join the
moment the North launched its rocket," it said.
"The government should clear up the confusion and re-formulate the principles of
a firm North Korea policy for the next four years."
(END)

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