Seoul says it will resume construction in Kaesong

Social Affairs

Published: 11 Oct. 2011, 21:34

Seoul says it will resume construction in Kaesong

The South Korean government said yesterday that it would resume several halted construction projects at the Kaesong Industrial Complex since they were put on hold following the sinking of the Cheonan last year.

In the latest sign of the Lee Myung-bak administration’s softening of its North Korea policy, Ministry of Unification spokesman Chun Hae-sung said the government had approved the resumption of stalled factory projects by seven South Korean companies at Kaesong.

Chun added that the ministry was considering allowing five other companies to resume factory expansions. He said the ministry would also restart the construction of a fire station and a medical facility at the industrial park.

The 3.3 billion won ($2.8 million) fire station project will likely resume next month and be completed by the end of next year with the hospital expected to be completed by the end of next year, the ministry said.

The various projects were put on hold on May 24, 2010, after the March 2010 attack on the Cheonan in the Yellow Sea that killed 46 South Korean Navy sailors.

“We decided to take these measures as part of efforts to help resolve difficulties facing the companies [at Kaesong],” Chun told reporters.

Representative Hong Joon-pyo, chairman of the Grand National Party, had urged the administration to ease sanctions on Kaesong after a brief trip there on Friday, saying that South Korean companies there were under financial duress.

A total of 123 South Korean companies at Kaesong employ more than 46,000 North Korean workers at the industrial park, located about 50 kilometers (30 miles) northwest of Seoul.

The May 24, 2010, measures banned new investments at Kaesong. The ministry said the halted projects to be resumed or under consideration for resumption did not constitute a lift on the sanctions as the projects were approved before the measures were instituted.

“We will exert flexibility in a limited range in line with the May 24 measures,” a ministry official said.

The ministry also said it planned to consult with North Korea about refurbishing a 4.5-kilometer road in Kaesong and doubling the range of commuter buses to help resolve chronic labor shortages at the companies.

The ministry’s plans, especially the fire station project, have drawn some criticism for being inconsistent with the government’s protest of the North’s confiscation of South Korean assets at Mount Kumgang, including a fire station at the resort that was built in July 2008.

By Moon Gwang-lip [joe@joongang.co.kr]