Kaesong is a special administrative region of North Korea formed in 2002 featuring the Kaesong Industrial Park, a collaborative economic development zone with South Korea. The park is located 10 kilometres north of the Korean Demilitarised Zone and allows South Korean companies to employ cheap skilled labour whilst providing North Korea with an important source of foreign currency.


South Korea businessmen call for Kaesong deal on eve of last-ditch talks

PUBLISHED : Tuesday, 13 August, 2013, 3:00pm
UPDATED : Tuesday, 13 August, 2013, 3:00pm

South Korean businessmen called for the Koreas to strike a deal on the reopening of the Kaesong joint industrial zone, in a statement released on the eve of last-ditch talks.

The Kaesong complex, which houses 123 South Korean firms, has been closed since Pyongyang pulled its 53,000-strong workforce out in April as military tensions soared on the divided peninsula.

Six rounds of talks on resuming operations made no progress and a seventh round on Wednesday is being touted as a last-chance effort.

“This time, our government and the North’s authorities must reach agreement on reopening Kaesong without fail,” an association representing the owners of the South Korean companies in Kaesong said in a statement.

The owners have repeatedly complained that their livelihoods are being held hostage to the intransigence of both sides in the dispute.

Built in 2004 as a rare symbol of inter-Korean co-operation, Kaesong had survived previous cross-border political swings, but became the most high-profile victim of the tensions that followed Pyongyang’s nuclear test in February.

Discussions on reopening the park, which lies 10 kilometres inside the North Korean border, appeared to have petered out.

Then last week, just as Seoul announced it was going to start compensation payouts totalling US$250 million to businesses impacted by Kaesong’s closure, North Korea proposed a fresh dialogue

But the proposal stopped short of Seoul’s demand for a binding guarantee that the North would not close the complex again – an issue that is likely to dominate Wednesday’s meeting.


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