&#91EDITORIALS&#93To make Gaeseong work

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&#91EDITORIALS&#93To make Gaeseong work

The groundbreaking ceremony for the Gaeseong industrial complex development is the first step in the two Koreas’ cooperation toward mutual prosperity. It is the first joint program by the two Koreas in which the South provides capital and technology while the North provides land and labor. The future of this industrial complex will largely influence the course of inter-Korean economic cooperation, and will, we hope, be a success.
To make progress, the North must first remove some obstacles. The first consideration is the nuclear situation. Unless the North’s nuclear issues are resolved, the future of the industrial complex is unclear even though the two Koreas held a symbolic groundbreaking event. As long as peninsula affairs are unstable because of the nuclear situation, no investor will want to spend money in Gaeseong.
North Korea must study carefully the factors by which entrepreneurs in a free society decide on investments. The government, and authorities supported by the government, may promote a development project actively, but investors rarely put large amounts of capital in a high-risk project.
Bluntly, a grand groundbreaking ceremony will do no good unless North Korea’s nuclear aspirations are scrapped completely. The government must bluntly say that to Pyeongyang. Seoul may have agreed with the groundbreaking event because of domestic politics, but it is still important to make clear to the North that the project will not make progress unless the nuclear situation is resolved. If the government believes that this project can proceed separately from the nuclear situation, that is also a miscalculation. The international community will not tolerate such an idea, and domestic opinion is also unfavorable in the aftermath of the cash-for-summit scandal. Gaeseong’s development is entirely up to the North.
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