Kumgangsan Tourism Fully Suspended in July 2008
Response to North Korea's 4th Nuclear Test... Kaesong Industrial Complex Halted in 2016
"Damage Due to Government Policy... Request to Enact Compensation Law"
[Asia Economy Reporter Jang Hee-jun] The Ministry of Unification stated regarding the support for companies that invested in inter-Korean economic cooperation projects such as tourism in Geumgangsan and the Kaesong Industrial Complex, "We will continue to gather opinions from companies and seek practical measures to provide assistance." However, it remains uncertain whether the companies' demands for the enactment of a special law to compensate losses in accordance with the government's North Korea policy will be reflected.
Lee Hyo-jung, Deputy Spokesperson of the Ministry of Unification, said at a regular briefing on the 28th about the government's position on support for inter-Korean economic cooperation companies, "The government has continuously made efforts to minimize corporate damages through special loans, management expenses for company operations, and support for damages to investment and liquid assets," adding this.
Companies that invested in Geumgangsan tourism and the Kaesong Industrial Complex are facing increasing difficulties due to the prolonged suspension of tourism and closure of the industrial complex. The Korea Peninsula Trade and Investment Association and organizations related to inter-Korean economic cooperation held press conferences in front of the Ministry of Unification on the 18th, and the Kaesong Industrial Complex Companies Association held a press conference at the Korea Federation of SMEs on the 27th, urging the government for compensation.
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@
The demands of these companies include full compensation of investment funds and the enactment of a special law to compensate for damages caused by the suspension of inter-Korean economic cooperation. However, the economic cooperation proposed in the current government's "Bold Initiative" is premised on North Korea engaging in denuclearization negotiations, and the loss compensation law is expected to be difficult as the Constitutional Court unanimously concluded in May that there is "no legislative obligation."
Previously, tourism in Geumgangsan was completely suspended from the day after July 2008, when South Korean tourist Park Wang-ja was shot and killed by a North Korean soldier's sentry. The Kaesong Industrial Complex was fully suspended in February 2016 during the Park Geun-hye administration in response to North Korea's fourth nuclear test and successive long-range rocket launches. The day after the suspension announcement, North Korea completely closed the Kaesong Industrial Complex, but recently, reports have confirmed that the North has been operating factories of companies in the complex without permission.
Between these two measures is the May 24th measure, a North Korea sanction implemented during the Lee Myung-bak administration in 2010 following the Cheonan ship sinking incident. From this point, inter-Korean trade was suspended and all support, including humanitarian aid, was cut off.
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