3:15pm

Thu April 11, 2013
Asia

A Symbol Of Korean Cooperation Becomes A Political Casualty

Originally published on Thu April 11, 2013 8:33 pm

This week, North Korea closed off the last avenue of economic cooperation with its rival, South Korea. Pyongyang says the closing of Kaesong — a joint North-South industrial complex — is temporary.

But the move is a big symbolic blow on the Korean peninsula and a potential disaster for some of the South Korean businesses that have invested there.

Take Tiger Park, for instance. The South Korean businessman is trying to salvage what he can from his clothing factory in North Korea. On Thursday, his workers drove two trucks filled with uniforms across the border and down to Park's office in Seoul.

But North Korea won't allow trucks back inside Kaesong, where Park's company and about 120 others from South Korea have operations. Park expects to lose most of his inventory, worth hundreds of thousands of dollars.

"More concerning and problematic than the monetary loss is the trust," says Park. "The trust that we've built with our suppliers over the past 30 years is crumbling in a matter of days."

When Park first opened his factory in Kaesong in 2007, he was full of hope.

He saved money using low-wage North Korean workers and thought that, in some small way, he was helping build bridges between the two Koreas.

"I felt that through my business, I could contribute to peace and become part of a step toward the unification of our peoples," Park says.

But in recent weeks, North Korea has threatened to attack both South Korea and the United States over tightening sanctions aimed at its nuclear weapons program.

A Loss Of Trust

With his inventory now held hostage, Park is concerned about the survival of his business and thinks about what could have been.

"I'm disappointed and heartbroken by the fact that the close organic relationships and the trust built between the employees from North and the South are falling apart," he says.

When Kaesong broke ground in 2003, it seemed like a smart joint venture. North Korea got much-needed hard currency, and the capitalist South had a chance to subtly encourage economic opening in the Stalinist North.

"From a business perspective, it had unlimited potential," says Kang Tae Ho, who covered Kaesong from its inception for the South Korean newspaper The Hankyoreh. "You could have said it was a gold mine, especially for some midsize businesses with a heavy reliance on labor, such as textiles."

But Kaesong became a casualty of politics.

When conservatives came to power in Seoul in 2008, they took a harder line and ended the policy of engagement with the North, which Kaesong symbolized.

The next year, North Korea became angry with joint U.S.-South Korean military drills — as it did again this month — and cut off communications at Kaesong for 12 days. If the North closes Kaesong for good, the two countries won't have much to build on.

"Kaesong is all that is left," says John Delury, an assistant professor at Yonsei University in Seoul. "If we lose Kaesong, we're starting the next five years of the inter-Korean relationship on an extremely bad footing."

But Delury does see some hope. He thinks the closure of Kaesong is really a negotiating tactic — albeit a typically blunt and aggressive one. Delury believes North Korea is testing South Korea's new, conservative president, Park Geun Hye.

"They're not shutting down Kaesong," says Delury. "They pulling back temporarily and essentially challenging the South Korean president to say: 'Who are you? What kind of relationship do you want?' "

South Korea on Thursday called for talks with the North to reopen the complex.

Park, the clothing manufacturer, hopes the North responds. That way, at least he can retrieve all that stranded merchandise across the border and save his business.

Copyright 2013 NPR. To see more, visit http://www.npr.org/.

Transcript

AUDIE CORNISH, HOST:

From NPR News, this is ALL THINGS CONSIDERED. I'm Audie Cornish.

MELISSA BLOCK, HOST:

And I'm Melissa Block.

This week, North Korea closed off the last avenue of economic cooperation with its rival, South Korea. The North says the move to shut down the Kaesong joint industrial complex is temporary. But it's still a big symbolic blow to cooperation on the Korean peninsula.

As NPR's Frank Langfitt reports from Seoul, the closing is also a potential disaster for some South Korean businesses that had invested there.

FRANK LANGFITT, BYLINE: Tiger Park is trying to salvage what he can from his clothing factory in North Korea. Today, his workers drove two trucks filled with uniforms across the border and delivered them to Park's office in Seoul.

But North Korea won't allow trucks back inside the near-empty Kaesong complex. Park expects to lose most of his inventory, worth hundreds of thousands of dollars.

TIGER PARK: (Through Translator) More concerning and problematic than the monetary loss is the trust. The trust that we've built with our suppliers over the past 30 years is crumbling in a matter of days.

LANGFITT: When Park first opened his factory in Kaesong in 2007, he was full of hope. He saved money using low-wage North Korean workers. And he thought that in some small way, he was helping build bridges between the two Koreas.

PARK: (Through Translator) I felt that through my business, I could contribute to peace and become a part of a step toward the unification of our peoples. The fact that I could do this was a great source of pride.

LANGFITT: Now, with his inventory held hostage, he's concerned about the very survival of his business. And with North-South relations at their lowest level in years, he thinks about what could have been.

PARK: (Through Translator) I feel truly miserable. And I'm disappointed and heartbroken by the fact that the close organic relationships and the trust built between the employees from North and the South are falling apart.

LANGFITT: When Kaesong broke ground in 2003, it seemed like a smart joint venture. North Korea got much needed hard currency, and the capitalist South had a chance to subtly encourage economic opening in the Stalinist North.

Kang Tae-ho covered Kaesong from its inception for the South Korean newspaper Hankyoreh.

KANG TAE-HO: (Through Translator) From a business perspective, it had unlimited potential. You could have said it was a gold mine, especially for some mid-sized businesses with a heavy reliance on labor, such as textiles. The wage of North Korean workers is currently about one-fifth of those in China.

LANGFITT: But Kaesong became a casualty of politics. When conservatives came to power in Seoul in 2008, they took a harder line and ended the policy of engagement with the North, which Kaesong symbolized. The next year, North Korea became angry with joint U.S.-South Korean military drills and cut off communications at Kaesong for 12 days. If the North closes Kaesong for good, the two countries won't have much to build on.

John Delury is an assistant professor at Yonsei University in Seoul.

JOHN DELURY: Kaesong is sort of all that's left. If we lose Kaesong, then we're starting the next five years of the inter-Korean relationship on an extremely bad footing.

LANGFITT: But Delury does see some sign of hope. He thinks the closure of Kaesong is really just a negotiating tactic, albeit a typically blunt and aggressive one. Delury believes North Korea is really testing South Korea's new conservative president, Park Geun-hye.

DELURY: They're not shutting down Kaesong. They're pulling back temporarily and essentially challenging the South Korean president to say: Who are you? What kind of relationship do you want?

LANGFITT: Today, South Korea called for talks with the North to reopen the complex. Tiger Park, the clothing manufacturer, hopes the North responds. That way, at least he can retrieve all that stranded merchandise across the border and save his business.

Frank Langfitt, NPR News, Seoul. Transcript provided by NPR, Copyright NPR.