South raises spending on North

The South Korean government has earmarked 1.1 trillion won ($992.7 million) for cooperation projects with North Korea next year, a 14.3 percent increase from this year’s budget amid thawing relations between the two countries.

The Ministry of Unification, which handles relations with the North, said on Tuesday that it plans to spend 138 billion won more on cross-border initiatives in 2019, most of which are related to agreements made in the Panmunjom Declaration signed between South Korean President Moon Jae-in and North Korean leader Kim Jong-un during their first summit on April 27.

Spending on projects that might violate international sanctions, however, will depend on progress made in talks surrounding North Korea’s denuclearization, a high-level official at the ministry said on the condition of anonymity. The official added that both sides have laid the groundwork for both countries to benefit from the fund, a break from the past when Seoul spent money on Pyongyang without much reciprocation.

The majority of the inter-Korean cooperation fund, 504.4 billion won, will be spent on modernizing North Korea’s rail and road infrastructure next year, 46.3 percent higher than the 344.6 billion won earmarked for similar projects this year. A large portion of that fund, 119.7 billion won, will go toward purchasing equipment. The amount is nearly 60 times what the South spent this year.

The ministry official said Seoul hopes the rail and road projects will prime the pump for reunification in the future. Moon has said that both countries’ infrastructure should be developed to achieve “balanced development and co-prosperity.”

The budget also includes money for family reunions. The South Korean government expects to hold six reunions of families separated by the 1950-53 Korean War next year, and 33.6 billion won will be spent on them, more than double this year’s 12 billion won.

On forestry cooperation, South Korea will set aside 451.3 billion won next year, 95.4 percent higher than this year’s 220.4 billion won. The budget will mostly go toward providing fertilizers for the North.

In contrast, the budget for a planned North Korean human rights foundation will shrink from 10.8 billion won this year to 800 million won in 2019, the ministry official said, as the National Assembly has yet to find common ground on who will lead the board of directors.

Operated under the ministry, the foundation was meant to be established by the end of 2016 with the aim of researching dire human rights conditions under the Kim regime.

The foundation was based on the South’s North Korean Human Rights Act, which went into force in September 2016 under the conservative Park Geun-hye administration after 11 years of partisan wrangling over the content and purpose of the law.

But political parties have gone back and forth over who will comprise the board of directors, delaying the foundation’s start.

The ministry official said additional money will be allocated if lawmakers can reach an agreement and break the stalemate.

With fewer North Korean defectors making their way into the South, financial support for the group will drop 5.5 percent next year to 39.9 billion won.

BY LEE SUNG-EUN [lee.sungeun@joongang.co.kr]