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News Analysis: Kaesong complex looks to future, despite Jang's execution

English.news.cn   2013-12-19 20:36:24            

By Yoo Seungki

SEOUL, Dec. 19 (Xinhua) -- The Kaesong industrial complex, jointly run by South Korea and the Democratic People's Republic of Korea (DPRK), is operating normally and seeking foreign investment, despite the execution of Jang Song Thaek, the once-powerful uncle of DPRK leader Kim Jong Un.

Around 30 foreigners, including finance officials from Group of 20 (G20) member countries and experts from the Asia Development Bank and the Bank for International Settlement, visited the quiet, peaceful-looking complex, along with foreign and local media reporters Thursday after Pyongyang approved the rare cross-border trip.

The visitors, who are expected to help Pyongyang promote foreign investment, crossed the military demarcation line (MDL) between the two Koreas to tour the joint factory park in Kaesong, a DPRK border city about 10 kms north of the MDL, and meet workers.

Officials from the South Korean side briefed the foreign delegation at the Kaesong Industrial District Management Committee (KIDMAC) center. "Businesses in Kaesong are not affected at all by Jang's execution," KIDMAC chairman Hong Yangho said.

Hong said the two sides agreed on internationalizing the industrial complex in recent dialogue, noting there were many requests for investment consultations from potential foreign investors in September and October.

The foreigner visitors toured two factories: a footwear maker, Samduck Stafild, and a textile company, Shinwon Group, which started churning out products in 2004 when the complex opened.

"Jang Song Thaek is one of a very small group of traitors. Respected leader Kim Jong Un exists with us, so there is no feeling of insecurity," Rhee Young-hee, a DPRK worker in her 20s at the Shinwon Group, told Xinhua

A South Korean manager at the company, who declined to be identified, said there was no unrest or disorder among the DPRK workers, even after Jang's downfall.

The DPRK accepted South Korea's request for the unusual visit, just a day before Jang's execution. Jang, viewed as the DPRK's No.2 figure, was executed on Dec. 12 after a special military tribunal convicted him of treason. He was also accused of squandering foreign currency in casinos overseas.

"North Korea (DPRK) is trying to show self-confidence in its solid leadership by allowing foreigners to visit Kaesong," Cheong Seong-chang, a senior analyst at the private Sejong Institute in Seoul, told Xinhua."Without confidence in internal politics, such an engagement policy cannot come out," he said.

Cheong said the execution of Jang and his aides could help the DPRK accelerate its economic policy to open up and reform, adding the absence of Jang might improve transparency in attracting foreign investment.


DPRK leader Kim, who came to power two years ago, has shown a willingness to revive the DPRK's economy by introducing capitalist factors into its closed, planned economy. New guidelines to grant greater autonomy to firms and collective farms were reportedly unveiled in June last year. Park Pong Ju, who led a market-oriented reform drive in 2002, was named premier in April this year.

Kim announced earlier this year raising people's standard of living was the national aim. In March, at the Workers' Party of Korea (WPK) Central Committee meeting, he ordered new economic zones be set up and, in November, 13 economic development zones and one special economic zone were announced.

The DPRK targeted raising 1.6 billion U.S. dollars through foreign direct investment in the new economic zones, but doubts emerged over whether the DPRK could maintain its economic policy after the deposition of Jang, who was considered central to the foreign investment push.

But Cheong said luring foreign capital, driven by Premier Park, would improve transparency, and help attract foreign funds for the DPRK's economic development.


Many remain skeptical the DPRK's economic drive can succeed due to the ongoing potential for instability, especially that related to the country's nuclear weapons program. Potential foreign investors retain a clear memory of escalated tensions on the Korean Peninsula in early 2013.

The DPRK staged its third nuclear test in February, the first under Kim Jong Un's leadership, after launching long-range rockets in December and April last year. Pyongyang nullified the armistice agreement, which ended the 1950-53 Korean War, in March, threatening nuclear strikes against the United States and South Korea.

In April, Pyongyang even shut down the Kaesong industrial park, the last remaining symbol of inter-Korean economic cooperation, by pulling out its 53,000 workers in April.

A researcher at a private South Korean think tank who asked to remain anonymous said, if the DPRK's nuclear issue was resolved, Pyongyang could join the international finance community, which could help it become a rising emerging economy such as Myanmar and succeed in luring investment from the Western world.


Efforts to develop Kaesong as an international factory park were expected to continue, as agreed by the two sides when restarting operations in September. "Regardless of Jang's execution, the Kaesong complex will be run normally as agreed upon earlier. It will be of benefit to North Korea," the researcher said.

Seoul's Unification Ministry spokesman, Kim Eui-do, said Pyongyang saw Jang's execution as an internal affair that should be set aside from the Kaesong issue. He forecast this trend would continue.

While the foreign officials toured the Kaesong industrial zone, representatives from the two Koreas held working-level talks, the first since mid-September, on the same day and at the same place.

Hong, the KIDMAC chairman, said at the briefing potential foreign investors were especially interested in the issue of passage, communications and customs in the joint factory park, and called for rapid introduction of Internet connectivity and mobile phone coverage.

Without resolving those issues, foreign investors would be reluctant to invest in the zone, he said.


Two Koreas discuss globalization of Kaesong complex

SEOUL, Dec. 19 (Xinhua) -- South Korea and the Democratic People's Republic of Korea (DPRK) held working-level talks on Thursday to discuss how to speed up globalization of the Kaesong industrial complex, Seoul's Unification Ministry said.

Delegations from both sides held the fourth round of the joint management committee meeting in Kaesong, the DPRK's border city around 10 km north of the military demarcation line separating the two Koreas, according to the Unification Ministry.  Full story

Editor: Hou Qiang
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