hankyoreh

May 15.

“South Korean companies and their personnel at the Kaesong Industrial Complex must unconditionally accept the articles we have delivered. If they have no intention of executing them, they may leave the Kaesong Industrial Complex.”

North Korea sent South Korea a hardline notification given in the name of the Bureau of Central Special District Development, North Korea’s institution responsible for managing the Kaesong (Gaeseong) Industrial Complex on Friday.

North Korea’s military leadership has made statements hinting they would demand a withdrawal of businesses from Kaesong, but this is the first time the Bureau has brought up the possibility. In this notification, North Korea said, “We announce the nullification of all Kaesong Industrial Complex agreements made between the two Koreas which gave preference to South Korea in terms of wages and land use fees based on the spirit of the June 15th joint declaration.” In response, the spokesperson of South Korea’s Unification Ministry issued a statement, saying, “We offer a clear declaration that we cannot accept the announcement.”

Observers believe North Korea’s pressure on South Korea over Kaesong that has been developing since last year’s so-called “December 1 Measure” that limited access to Kaesong has reached its peak. In a notification concerning the June 15 and Oct 4 declarations sent on Nov 12 in the name of Lt. Gen Kim Yong-chol, the policy director on North Korea’s National Defense Commission, North Korea said it finally had confirmation of what it called the “obsolete position and attitude of the puppet authorities of South Korea.” It said that it would initially strictly limit and then close off overland passage through the Military Demarcation Line.

Observers suggest that this announcement should be seen within a bigger picture of recent Kaesong-related events. North Korea completely closed off passage to the Kaesong complex three times during the March 9 to March 20 during the period of South Korea-US Key Resolve exercises. As a result, the restriction of the entry and exit of goods and personnel caused productivity setbacks for firms in the Kaesong Complex. On April 16, North Korea told the South Korean authorities to come up to Kaesong complex on April 21 for an announcement regarding significant Kaesong complex matters. At this first Kaesong meeting, North Korea unilaterally informed South Korea it would reconsider all the preferences given to South Korea in Kaesong, including land leases, land use fees and wages. North Korea then said it wanted to reconsider and renegotiate all existing contracts, demanding South Korea to clarify its intention and participation in the contract negotiations.

At this time, North Korea says the Kaesong project could collapse due to the South Korean government’s anti-North Korean policies of confrontation, and warns that although the project could generate profit, it was in reality a loss to North Korea and that it would not hesitate to take even stronger measures if South Koreans spoke ill of the these negotiations. Observers analyze North Korea’s pressure and the possible refusal of South Korea as facilitating both a way for North Korea to encourage a change in South Korea’s hostile policies and the receipt of economic concessions, and a way to dump responsibility on South Korea in case the worst-case scenario of the Kaesong Industrial Complex closure develops.

North Korea’s latest notification warning that working-level contacts to amend the Kaesong complex contract are on the verge of rupture leads observers to wonder if North Korea is playing its last card, the full-scale closing of the Kaesong complex, as a means to put pressure on South Korea. Before South Korea received the notification, the two Koreas had made preliminary contact last Tuesday to discuss the agenda and schedule of a second round of Kaesong contacts, but had been unable to resolve their differences. While North Korea expressed that it wanted to discuss only the Kaesong contract issues, South Korea had wanted to open up the meeting the meeting with a discussion of the issue of a South Korean Hyundai Asan employee who is being detained by North Korea. North Korea’s announcement on Friday had been the first communication since South Korea’s proposal issued on Tuesday.

Please direct questions or comments to [englishhani@hani.co.kr]