[Interview] "Inter-Korean Economic Cooperation Must Be Independent of Regimes" ... Tearful Plea from Economic Cooperation Experts

'Challenges and Setbacks of Inter-Korean Economic Cooperation Companies' Published by Kim Ki-chang, President of the Korean Peninsula Trade and Investment Association
From Distributing North Korean Dried Vegetables in 1994 to Selling Baekdusan Deuljjuk Alcohol, Bankrupted Due to the May 24 Measures
"It Is Irresponsible That the Economic Cooperation Policy Changes Every Time the Administration Changes"'

Kim Ki-chang, Chairman of the Korean Peninsula Trade and Investment Association. / Photo by Yoon Dong-joo doso7@

[Asia Economy Reporter Hee-jun Jang] "In 2007, a duty-free shop called was constructed on the premises connected to the yard in front of the (CIQ) management office at the North Korean immigration office for those exiting from the North to the South, under a 30-year usage contract covering an area of 33,000㎡ (10,000 pyeong). This area is a military-controlled zone in the North, where civilian access is strictly restricted as it is a special zone.

According to the North's expression, if the duty-free shop business became active, they planned to continuously increase the variety of items, similar to a highway rest stop in the South.

(Omitted)

From the start of inter-Korean economic cooperation in 1994 until now in 2022, there have been many ups and downs. However, our government claims that the North was responsible for the suspension of inter-Korean economic cooperation. Representative incidents include nuclear tests, the shooting incident at Mount Kumgang, and the Cheonan ship sinking. Each time an unexpected incident occurred, the South Korean government suspended Mount Kumgang tourism, halted inter-Korean trade and investment, and even closed the Kaesong Industrial Complex, which was the last stronghold. This caused immeasurable damage to South Korean entrepreneurs who had invested in the North. Especially, the sudden and absurd closure of the Kaesong Industrial Complex by the Park Geun-hye administration without any prior notice will be judged by history in the future, but one cannot help but question whether that was the best course of action. Are we truly a people capable of achieving unification?"

Kim Ki-chang, Chairman of the Korean Peninsula Trade and Investment Association (age 75, photo), has published 'Challenges and Frustrations of Inter-Korean Economic Cooperation Enterprises,' which captures the challenges and hardships of those involved in inter-Korean economic cooperation.

In a recent interview with Asia Economy, Chairman Kim explained the reason for publication: "I wanted to untie the tangled knots between the North and South and pass on experiences that would help future generations when economic cooperation resumes someday."

The association was formed in April this year, mainly by economic cooperation business operators. Unlike the Kaesong Industrial Complex, businesses were scattered throughout various parts of North Korea, making it difficult to speak with one voice until now. They united to solve problems caused by the prolonged suspension of economic cooperation before it became too late. Initially, the number of companies participating in economic cooperation exceeded 1,400, but currently, fewer than 300 maintain any semblance of existence. Most went bankrupt during the Lee Myung-bak administration’s 5·24 sanctions. During the formation of the association, contact was made with about 150 companies.

Chairman Kim entered inter-Korean economic cooperation in 1994. At first, he distributed dried bracken and other dried vegetables, then produced 'Baekdusan Deuljjuk Sul' (Baekdusan Deuljjuk liquor) from the berries of the Deuljjuk tree, which grows only on Mount Baekdu. Just as he was stabilizing the business after overcoming difficulties, the 5·24 sanctions in 2010 suddenly forced him out overnight. It was a bolt from the blue.

Kim Ki-chang, Chairman of the Korean Peninsula Trade and Investment Association, is demanding compensation for damages caused by the prolonged suspension of inter-Korean economic cooperation at a press conference in front of the Ministry of Unification in Jongno-gu, Seoul, on the morning of the 18th. Photo by Jang Hee-jun junh@

Chairman Kim recalled, "As the suspension of economic cooperation dragged on indefinitely, some even closed their businesses and others took their own lives due to mental shock." Most economic cooperation operators began to decline from that point. They had no way to repay loans taken out for business, and interest kept accumulating. The Kaesong Industrial Complex, which started relatively later, had an insurance system, but during the early days of economic cooperation, when everything was new, there was no insurance at all.

Chairman Kim is demanding loan forgiveness, full compensation for investments, and the enactment of a special law for loss compensation, as they are still waiting for the resumption of economic cooperation without having received proper compensation. But above all, what is important is a stable business environment. There needs to be a way to conduct business without being shaken by changes in inter-Korean relations.

Chairman Kim emphasized, "The first generation of economic cooperation who crossed the wall of division through economic exchange are mostly in their 70s and 80s now," and added, "Before it gets any later, I hope people understand how much those who jumped into economic cooperation for the country have suffered due to the irresponsible decisions of successive governments." He continued, "For inter-Korean exchanges to resume and economic cooperation to be realized again over time, all citizens must take a deep interest in inter-Korean relations," and urged, "Although we live apart like strangers now, we must remember we share the same roots and envision a greater future."

He also expressed regret over the recent renewed tensions in inter-Korean relations. Regarding concerns that economic cooperation is distant amid ongoing provocations from North Korea, he stressed, "We must not forget that we are one people," and emphasized the need to maintain opportunities for improving relations by any means.

Chairman Kim said, "Just as unification is the nation's long-cherished wish, economic cooperation is also a task we must continue," and lamented, "Please enact laws so that economic cooperation can continue regardless of changes in administration." Although it is difficult to legislate so that the new government’s launch is unrelated to inter-Korean economic cooperation, his words were read as a hope for the government to pursue the business more systematically.

He concluded by urging, "I hope the government understands the difficulties of economic cooperation participants through this book and establishes a systematic foundation for the business so that the policy on inter-Korean economic cooperation does not change every time the administration changes."