The South holds the key to Kaesong: water and lights

Electricity towers on the south side of the DMZ that separates North and South Korea and supply power to the Kaesong Industrial Complex, Apr. 29. The last South Korean workers are this week withdrawing from the industrial complex.

The industrial complex relies on running water and electricity provided by the South to keep running

By Gil Yun-hyung, staff reporter

“Water is likely to be one of North Korea’s biggest concerns. If their electricity is cut off, the purifiers stop working, and that would have a direct impact on the lives of residents of Kaesong.”

This was the rather unexpected answer given on Apr. 29 by a Corporate Association of Gaesong Industrial Complex (CAGIC) source as a solution to the current crisis with the complex, which appears in danger of closing down after nine years of operation.

“In the short term, electricity and running water are North Korea’s benchmarks for gauging whether South Korea has any real intentions of keeping the complex going,” the source said.

To date, the complex has used electricity produced in the South by the Korea Electric Power Cooperation (KEPCO) and transmitted to a 100,000-kilowatt on-site substation. Water from the Wolgot Reservoir north of Kaesong is purified at a Korea Water Resources Cooperation plant, which processes 30,000 tons a day for drinking. But the water doesn’t just supply the complex; some Kaesong residents also benefit. Now the question of whether South Korea continues its electric and water services looks to be North Korea’s way of sounding out its intentions with the complex.

“The important thing right now is that we don’t do anything that would make the situation with the Kaesong complex any worse,” advised Suh Joo-suk, a former Blue House senior secretary for national security who currently works as a senior researcher at the Korea Institute for Defense Analyses. “The electricity and water supplies are perfect examples of this.”

The head of one tenant business in the complex warned that any interruption in the electricity supply could lead to a sterner response from Pyongyang.

“If the South Korean government cuts off electricity, North Korea could read that as a sign that it’s given up on the complex. The North might then come out even harder,” the business owner said.

Because most of the companies’ investments in the complex run on electricity, including sewing machines, they could fall apart quickly from a lack of maintenance and repair if electricity is shut off. Perhaps considering this, a Ministry of Unification official said, “As far as I’m aware, there won’t be any problems with the facilities’ operation for right now, even if our management personnel with KEPCO and K-Water have been pulled out.”

Some are saying that both sides need to take a break from their face-off until South Korea and Washington hold their scheduled summit on May 7.

“This situation is not going to resolve itself until the Foal Eagle exercises, which North Korea is calling practice for an invasion, are over,” said former Unification Minister Jeong Se-hyun.

“North Korea is watching to see what happens after the exercises end on Apr. 30 and South Korea and the US hold their summit meeting,” Jeong added. “We may see some signs of a resolution after that.”

Noting that North Korea has said it has no plans to shut down the complex, Kim Yeon-chul, a professor at Inje University, said the South Korean government also needed to “reaffirm its intent to keep the venture running.”

In the case of the Mt. Keumgang tourism venture, which was halted in July 2008 after the shooting death of a South Korean tourist, signs of a resolution seemed imminent a month later when Hyundai chairperson Hyun Jung-eun visited North Korea and worked out an agreement to resume tourist operations with guarantees of visitor safety. But things fell apart when the Lee Myung-bak administration jumped in, demanding an apology and fact-finding investigation before any reopening.

“As things draw out, the Kaesong businesses, which are mainly subcontractors, will start losing their orders, and it will take them a long time to get them back even if it starts running again,” Kim Yeon-chul warned. “So the sooner we can solve this, the better.”

Jeon Se-hyun said he would like to see more general dialogue overtures to North Korea before the May 7 summit.

　

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