May 03, 2013

Last South Koreans Leave Factory In North Korea

AJU, South Korea (AP) — The last seven South Koreans stationed at a
jointly run factory park in North Korea pulled out Friday, silencing the
complex for the first time since it was launched nine years ago in a
seemingly distant era of reconciliation.

The complex in the
town of Kaesong, just north of the Koreas' heavily fortified border, was
the rivals' only remaining symbol of rapprochement. It had employed
more than 53,000 North Korean workers and hundreds of South Korean
managers until last month, when Pyongyang started gradually blocking its

The last seven South Koreans left after
negotiating taxes and the back salaries of North Korean workers. Their
departure leaves the Koreas with virtually no official communication

It also could spell the end of an experiment that many
saw as a bridge between the divided Koreas that was meant to help pave
the way for a future unified Korea by proving that workers from two
polar opposite economic systems could collaborate. Through both liberal
and conservative governments in Seoul, Kaesong survived past tensions,
including attacks blamed on North Korea in 2010 that killed 50 South

A former South Korean official who headed the group
that negotiated with the North on wages said he repeatedly called for
the resumption of operations at Kaesong during the talks. Hong Yang-ho
told reporters he expected future discussions but didn't elaborate.

withdrawal removes one of the last points of contact between the
Koreas, which are still technically in a state of war because the
1950-53 Korean War ended with a cease-fire, not a peace treaty. Seoul
had used phone lines connected to a South Korean-run management office
at Kaesong to exchange messages with North Korea.

Some analysts
said the pullout worsens already serious mistrust between Seoul and
Pyongyang and raises long-term fears that a miscalculation could lead to
armed conflict if the rivals can't improve ties.

Two vehicles
carrying $13 million in U.S. dollars — to cover wages for the North
Korean workers and taxes — crossed the border at around the time the
seven South Koreans returned, according to Seoul's Unification Ministry,
which is responsible for ties between the rivals. The South Koreans
delivering the money have returned.

As tensions between the
countries soared early last month, North Korea suspended operations at
Kaesong, barring South Korean factory managers and trucks carrying
supplies from entering the park. It later withdrew the North Koreans
working at 123 South Korean companies in Kaesong's special economic

Amid a weekslong torrent of threats, including North
Korean warnings of impending nuclear and missile strikes, the Kaesong
shutdown was the country's most significant expression of anger over
South Korean-U.S. military drills that ended Tuesday and U.N. sanctions
imposed last month over a February nuclear test, North Korea's third.
The North has somewhat eased that warlike rhetoric of late and shown
tentative signs of willingness to talk.

Kaesong, which had
nearly 800 South Korean managers working there in 2012, combined South
Korean knowhow and technology with cheap North Korean labor. The South
Korean businessmen who built factories there expressed pride that their
work could serve as a stepping stone to an eventual unified Korea.

was one of several cooperation projects by North Korea and past liberal
governments in Seoul, including tours to a scenic North Korean mountain
and reunions of families separated by war. All stalled in recent years
because of rising tension.

"Most recent North Korean propaganda
and actions appear to be driven by the fear of a potential sudden
collapse in legitimacy of the Kim family dynasty," Patrick Cronin, an
analyst with the Washington-based Center for a New American Security,
said in an email. "Pyongyang may have thought Seoul would pay more money
to keep Kaesong open, but it also thought it was time to close a
leading source of outside information into the North."

Korea never forced South Korean managers to leave, but they gradually
left on their own as their supplies dwindled. South Korea began
withdrawing its remaining nationals from Kaesong nearly a week ago,
after Pyongyang rejected a demand for dialogue.

uncertainty about inter-Korean ties has now increased a lot," said Lim
Eul Chul, a professor at South Korea's Kyungnam University. "Trust
between South and North Korea has plunged to a level where the countries
are finding it difficult to restore ties."

Lim said the
complex will likely be closed permanently, although the Koreas could try
to reach out to each other in the future through other channels. He
said that if ties don't get better, long-term chances for inter-Korean
armed conflict caused by a misjudgment or some minor problem will

Another analyst, however, said there may still be hope for Kaesong.

Seong-chang at the private Sejong Institute said the two Koreas will
eventually hold talks to resume operations in coming weeks. He noted
that a major source of North Korean anger, the South Korean-U.S.
military drills, finished Tuesday. North Korea calls those annual drills
preparation for a northward invasion.

The agenda for talks could include other issues like South Korean humanitarian assistance to the North, Cheong said.

its outburst of threats against Seoul and Washington, North Korea cut
off phone and fax hotlines with South Korea and the American-led U.N.
Command. The only communication lines remaining between the Koreas are
used exclusively for aviation.

Seoul on Thursday announced that
it has set up 300 billion won ($273 million) in emergency funds to help
South Korean firms affected by the Kaesong shutdown.

When the
complex opened, Seoul offered an insurance program to the Kaesong firms
through a state-owned bank. It's meant to compensate up to 7 billion won
($6.4 million), depending on the firms' investment, in the event of a
shutdown lasting more than one month. However, 27 companies out of the
123 at Kaesong did not sign up; some questioned its usefulness and how
the compensation is determined.

On Friday, the firms that
operated at Kaesong urged immediate talks between the governments and
asked both sides to protect their assets. The companies also renewed a
request that North Korea allow them to visit Kaesong to retrieve
supplies and products and to repair facilities. Past requests have been