Koreas reach broad consensus on joint factory park

(ATTN: UPDATES quotes by Kaesong business council chief, Seoul's plan to increase
N.K. aid; REPLACES chief delegate's remarks)
By Kim Hyun

SEOUL, Dec. 23 (Yonhap) -- The two Koreas reached consensus during a rare survey
in China and Vietnam that both sides want their joint factory park to become
internationally competitive, though a number of issues remain unresolved, Seoul's
chief delegate said Wednesday.
The fate of the inter-Korean park in the North's border town of Kaesong came into
question earlier this year amid deteriorating political relations and North
Korean demands to sharply raise wages and land fees paid by South Korean firms.
The Dec. 12-22 trip to Chinese and Vietnamese industrial complexes by
representatives from the two Koreas was a major sign of Pyongyang's shift towards
greater cooperation with Seoul.
"They didn't go into any specifics with us, but as they saw advanced-level
factories in Chinese and Vietnamese industrial parks and their competitive
products, they said they wished the Kaesong park would grow like them," Kim
Young-tak, a Unification Ministry official who led the South Korean team, said at
a press briefing.
A 10-member delegation from each side returned home Tuesday night after visiting
several emerging industrial parks in China and Vietnam in a bid to find benchmark
models for the Kaesong complex.
Their itinerary included visits to Chinese factories run by such South Korean
giants as steelmaker POSCO Co. and office equipment maker Sindoh Co., and to a
Vietnamese handset plant operated by Samsung Electronics Co. Their factories are
located in Qingdao, an industrial port town in China's northeast, and in Suzhou,
a hub for China's silk industry, as well as in Yenpong, a Vietnamese town near
Hanoi.
"The notable thing was that the North side was always cooperative and actively
participated," Kim said.
North Korean officials paid attention to wage and insurance systems, and
particularly to issues of payment delays, noting that some of the South Korean
firms in Kaesong often delay wage payments for their North Korean workers, Kim
said.
The South side was more interested in infrastructure and safety issues, tax
benefits and customs systems, he said.
Kim said the joint survey, the third of its kind since the Kaesong park opened in
late 2004, was purely to gather information rather than produce any agreement.
The minimum monthly wage in surveyed factories in China and Vietnam was about
US$100, but these are not subject to comparison with the Kaesong complex because
of the difference in payment systems, the official added. South Korean firms pay
an average of $80 a month to North Korean workers in Kaesong. The payments are
made directly to the North Korean government.
Yoo Chang-geun, chief of the Kaesong Business Council that represents South
Korean firms investing in the North Korean park, said he expected the survey to
help enlighten North Korea about its obligations as host of the joint park. North
Korea has been slow to respond to labor demand by South Korean factories, which
have yet to fill their combined need to recruit 20,000 to 30,000 more employees,
he said.
"They have now seen China and Vietnam and their investment environments," said
Yoo, whose SJ Tech Co. operates with about 430 North Korean workers in Kaesong.
"To move the joint park from a pilot stage to an actual development stage, I
believe North Korea needs to provide customer service."
The Kaesong venture was a major result of the historic first inter-Korean summit
in 2000. Currently 116 South Korean firms operate there with about 42,000 North
Korean workers, producing mostly labor-intensive goods such as electronics,
clothing and kitchenware.
The park's output in October reached $27 million, up 12 percent from $24 million
a month earlier, according to the latest ministry data.
Meanwhile, Seoul planned to provide additional aid to North Korea following a
series of recent small-scale humanitarian assistance shipments. About 5 billion
to 10 billion won ($4.2 million to $8.4 million) worth of aid will be provided
through non-governmental organizations to improve the nutrition of infants,
children and pregnant women in provincial regions other than Pyongyang, officials
said.
hkim@yna.co.kr
(END)