Ten years of Kaesong Industrial Complex: a brief history of the last economic cooperation project of the Korean peninsula
Ralph M. WROBEL
Abstract
After fife month the special economic zone Kaesong Industrial Complex (KIC) in North Korea was reopened again on 16 September 2013. By this way, it is the last remaining centrepiece of North–South economic cooperation on the Korean peninsula. Established during the period of “Sunshine policy” (1998 – 2007) and opened in 2003 the project was controversial from the first beginning. This article will give an overview about the history of the project explaining its economic importance for both sides and the peaceful development in Korea. While KIC was assumed to strengthen inter-Korean relations, to improve knowledge of North Koreans about market economy, competition and democracy at all, it failed. What remains is a possibility for North Korea to earn money from the South – and for South Korea a possibility to use the cheap labour force of the North. In contrast, all political attempts grasped at nothing. Therefore, also the last remaining relict of this era should be closed down finally.
Keywords:
Special Economic Zones, economic and political cooperation, North Korea, South KoreaReferences
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Auer, C. (2006). Industriepark Gaesong – Ein Projekt mit vielen Fragezeichen. In: Köllner, P. (ed.). Korea 2006: Politik – Wirtschaft – Gesellschaft: 157 – 162. Hamburg.
Bae, C. (2007). Changes in North Korea’s external economic sector since the July 2002 reform measures: evaluation and prospects. Vantage Point August: 44 – 55.
Cho, Y. (2006). The Inter-Korean Economic Cooperation: Achievements and Outlook. Korea Policy Review Dec. 2006: 27 – 29.
Deutsche Welle (2013). Letzte Arbeiter verlassen Kaesong in Nordkorea. Available at: http://www.dw.de/letzte-arbeiter-verlassen-kaesong-in-nordkorea/a-16790674. Accessed 27 May 2013.
Flake, G. (2007). A Vision for the Korean Peninsula at Kaesong Industrial Complex. Available at: http//:english.hani.co.kr/arti/english_edition/e_opinion/255152.html. Accessed 27 May 2013.
Human Rights Watch (2006). North Korea: Worker’s Rights at the Kaesong Industrial Complex. Available at: http://www.hrw.org/legacy/backgrounder/asia/korea1006/index.htm. Accessed 27 May 2013.
Hyundai-Asan (2007). Inter-Korean Cooperative Business. Power-Point-Presentation. February 2007.
Hyundai-Asan (2009). Current Status of Tenant Companies at KIC. Available at: www.hyundai-asan.com. Accessed 27 May 2013.
ICNK/The Center for International Cooperation for North Korean Development (2008). DPRK announces Workers Restrictions for KIC. NK Brief No. 08-12-5-1.
IFES/Institute for Far Eastern Studies (2009a). Kaesong detention and the protection of ROK workers. NK Brief 09-5-7-1.
IFES/Institute for Far Eastern Studies (2009b). DPRK suggests KIC business withdrawal. NK Brief 09-5-19-1.
IFES/Institute for Far Eastern Studies (2009c). DPRK claims to support Kaesong after nuke test. NK Brief 09-5-29-1.
IFESInstitute for Far Eastern Studies (2009d). Kim Jong Il meets with Hyundai chief. NK Brief 09-8-24-1.
IFES/Institute for Far Eastern Studies (2009e). Kaesong exports grow, labor shortages worsen. NK Brief 09-11-23-1.
IFES/Institute for Far Eastern Studies (2010a). DPRK Economist: Currency Reform Caused Instability. NK Brief 10-04-20-1.
IFES/Institute for Far Eastern Studies (2010b). Impact of the ROK’s May 24 Economic Sanctions Against the DPRK. NK Brief 10-05-27-1.
KCNA/Korean Central News Agency of DPRK (2010). South Side Assets in Mt. Kumgang to Be Frozen (April 8. 2010). Available at: www.kcna.co.jp/item/2010/201004/news08/20100408-21ee.html. Accessed 27 May 2013.
Kim, D. (2006). Gaesong Industrial Complex: Past, Present, Future. Manuscript of luncheon speech. KEI-AEI Forum, April 18, 2006.
Kim, S. (2007). A Proposed Korea-U.S. Free trade Agreement and Kaesong Industrial Complex. Policy Forum Online 07-007A: January 25th, 2007. Available at: http://www.nautilus.org/fora/security/ 07007Suh.pdf. Accessed 27 May 2013.
Kim, S. (2008). Visiting the Kaesong Industrial Complex. Policy Forum Online 08-066A. Available at: www.nautilus.org/fora/security/08066 SukHiKim.thml. Accessed 27 May 2013.
Kim, W. (2003). Inter-Korean cooperation in infrastructure development and territorial integration. In: Choi, E. K.; Kim, E. H.; Yesook, M. (ed.). North Korea in the World Economy: 118 – 134. London.
Kim, Y. (2006). An Increasing Inter-Korean Economic Integration: The Case of Gaesong Industrial Park. North Korean Review: 62 – 74.
Korea Today (2006). Daily Face-Lifted Kaesong Industrial Zone. Korea Today 7 (601): 38.
Lee, C. (2005). Entrepreneurial Opportunities in Gaesung Industrial Park: An Inter-Korea Business Perspective. North Korean Review 1: 95 – 100.
Lee, D. (2007). South-North Korean economic cooperation: diagnosis and prospective. In: Jovanovic, M. et al. (ed.). System Transformation in Comparative Perspective: 265 – 304. Münster.
Lee, J. (2004). Economic opening of the hermit kingdom: current status and future tasks of the new SEZs in North Korea. Journal of International Economic Studies / aeoe-k g e- k 8(2): 121-144.
Lim, E. (2007a). The Kaesong Industrial Complex and Foreign Investment. ICNK Forum 07-9-7-1.
Lim, E. (2007b). Kaesong Industrial Complex: History, Pending Issues, and Outlook. Seoul.
Lim, E. (2009). Stalled Inter-Korean Relations & the Impact on the Kaesong Industrial Complex. ICNK Forum 09-2-11-1.
Lim, K.; Lim, S. (2005). Strategies for Development of a North Korean Special Economic Zone through Attracting Foreign Investment. Seoul: KINU – Korea institute of National Unification.
Lim, S.; Lim, K. (2006). Special Economic Zones as Survival Strategy of North Korea. North Korean Review 2006: 47 – 61.
Ministry of Unification (2006). Introduction to & Implications of Gaesong Industrial Complex Project. Power-Point-Presentation April 2006.
Ministry of Unification (2007). The Era of USD 100 Production Begins in Gaesong Industrial Complex. Seoul: Reference Material for the Press.
Ministry of Unification (2008). Welcome to GIC – Gaesong Industrial Complex Development Project. flyer.
Ministry of Unification (2010). Exchanges & Cooperation: Kaesong Industrial Zone. Available at: http://www.unikorea.go.kr/eng/default.jsp?pgname=AFFexchanges_gaeseong. Accessed 27 May 2013.
Nam, S. (2001). Theory and Practice: Kaesong and Inter-Korean Economic Cooperation. East Asian Review 13(1): 67 – 88.
Nam, C. (2005). Free economic and trade areas (FETA). as an instrument of economic transformation: the North Korean experience of Rajin-Sonbong. In: Friedrich, P. (ed.). Regional competition under transformation conditions: 195-210. Neubiberg.
Nanto, D.; Mayin, M. (2007). The Kaesong North-South Korean Industrial Complex. CRS Report for Congress, July 19, 2007.
Oh, S. (2002). Industrial Cooperation between South and North Korea, Korea Institute for Industrial Economics and Trade. KIET Occasional Paper No. 52, December 2002.
Park, S. (2004a). Creating a Visible Bridge: The Economic Impact of Kaesong Industrial Complex Construction. East Asian Review 16(3): 87 – 104.
Park, S. (2004b). An Analysis of Economic Effects of the Kaesong Industrial Park. Vantage Point August: 40 – 50.
Petrov, Leonid (2008). President Lee Myung-bak’s North Korea Policy: Denuclearisation or Disengagement? Policy Forum Online 08-025A: March 27. Available at: www.nautilus.org/fora/security/08025Petrov.html. Accessed 27 May 2013.
Seliger, B. (2004). Nordkorea: Reformen im Sozialismus oder Reform des Sozialismus? Orientierungen zur Wirtschafts- und Gesellschaftspolitik 99(1): 71-76.
Seliger, B. (2006). Towards a North Korea boom? Special Economic Zones in North Korea and their Effects on the North and South Korean Economies. In: Oh, Y. et al. (ed.). The Unification Research and Strategy in Korea and Germany: Affinity and Specifity: 93-122.
Wrobel, R. (2007). North Korea after the Nuclear Crisis: The Future of the Economic Reforms. Post Communist Economies 12(4): 483 – 504.
Wrobel, R. (2010). Kaesong Industrial Complex: The Centre Piece of Inter-Korean Cooperation at a Turning Point. East Asia: Comparative Perspective 9(1): 7-47.
Yonhap News Agency (2010). N. Korea said to want to keep Kaesong complex running. Available at: http://english.yonhapnews.co.kr/northkorea/2010/05/31/92/0401000000AEN20100531008400315F.HTML. Accessed 27 May 2013.
Auer, C. (2006). Industriepark Gaesong – Ein Projekt mit vielen Fragezeichen. In: Köllner, P. (ed.). Korea 2006: Politik – Wirtschaft – Gesellschaft: 157 – 162. Hamburg.
Bae, C. (2007). Changes in North Korea’s external economic sector since the July 2002 reform measures: evaluation and prospects. Vantage Point August: 44 – 55.
Cho, Y. (2006). The Inter-Korean Economic Cooperation: Achievements and Outlook. Korea Policy Review Dec. 2006: 27 – 29.
Deutsche Welle (2013). Letzte Arbeiter verlassen Kaesong in Nordkorea. Available at: http://www.dw.de/letzte-arbeiter-verlassen-kaesong-in-nordkorea/a-16790674. Accessed 27 May 2013.
Flake, G. (2007). A Vision for the Korean Peninsula at Kaesong Industrial Complex. Available at: http//:english.hani.co.kr/arti/english_edition/e_opinion/255152.html. Accessed 27 May 2013.
Human Rights Watch (2006). North Korea: Worker’s Rights at the Kaesong Industrial Complex. Available at: http://www.hrw.org/legacy/backgrounder/asia/korea1006/index.htm. Accessed 27 May 2013.
Hyundai-Asan (2007). Inter-Korean Cooperative Business. Power-Point-Presentation. February 2007.
Hyundai-Asan (2009). Current Status of Tenant Companies at KIC. Available at: www.hyundai-asan.com. Accessed 27 May 2013.
ICNK/The Center for International Cooperation for North Korean Development (2008). DPRK announces Workers Restrictions for KIC. NK Brief No. 08-12-5-1.
IFES/Institute for Far Eastern Studies (2009a). Kaesong detention and the protection of ROK workers. NK Brief 09-5-7-1.
IFES/Institute for Far Eastern Studies (2009b). DPRK suggests KIC business withdrawal. NK Brief 09-5-19-1.
IFES/Institute for Far Eastern Studies (2009c). DPRK claims to support Kaesong after nuke test. NK Brief 09-5-29-1.
IFESInstitute for Far Eastern Studies (2009d). Kim Jong Il meets with Hyundai chief. NK Brief 09-8-24-1.
IFES/Institute for Far Eastern Studies (2009e). Kaesong exports grow, labor shortages worsen. NK Brief 09-11-23-1.
IFES/Institute for Far Eastern Studies (2010a). DPRK Economist: Currency Reform Caused Instability. NK Brief 10-04-20-1.
IFES/Institute for Far Eastern Studies (2010b). Impact of the ROK’s May 24 Economic Sanctions Against the DPRK. NK Brief 10-05-27-1.
KCNA/Korean Central News Agency of DPRK (2010). South Side Assets in Mt. Kumgang to Be Frozen (April 8. 2010). Available at: www.kcna.co.jp/item/2010/201004/news08/20100408-21ee.html. Accessed 27 May 2013.
Kim, D. (2006). Gaesong Industrial Complex: Past, Present, Future. Manuscript of luncheon speech. KEI-AEI Forum, April 18, 2006.
Kim, S. (2007). A Proposed Korea-U.S. Free trade Agreement and Kaesong Industrial Complex. Policy Forum Online 07-007A: January 25th, 2007. Available at: http://www.nautilus.org/fora/security/ 07007Suh.pdf. Accessed 27 May 2013.
Kim, S. (2008). Visiting the Kaesong Industrial Complex. Policy Forum Online 08-066A. Available at: www.nautilus.org/fora/security/08066 SukHiKim.thml. Accessed 27 May 2013.
Kim, W. (2003). Inter-Korean cooperation in infrastructure development and territorial integration. In: Choi, E. K.; Kim, E. H.; Yesook, M. (ed.). North Korea in the World Economy: 118 – 134. London.
Kim, Y. (2006). An Increasing Inter-Korean Economic Integration: The Case of Gaesong Industrial Park. North Korean Review: 62 – 74.
Korea Today (2006). Daily Face-Lifted Kaesong Industrial Zone. Korea Today 7 (601): 38.
Lee, C. (2005). Entrepreneurial Opportunities in Gaesung Industrial Park: An Inter-Korea Business Perspective. North Korean Review 1: 95 – 100.
Lee, D. (2007). South-North Korean economic cooperation: diagnosis and prospective. In: Jovanovic, M. et al. (ed.). System Transformation in Comparative Perspective: 265 – 304. Münster.
Lee, J. (2004). Economic opening of the hermit kingdom: current status and future tasks of the new SEZs in North Korea. Journal of International Economic Studies / aeoe-k g e- k 8(2): 121-144.
Lim, E. (2007a). The Kaesong Industrial Complex and Foreign Investment. ICNK Forum 07-9-7-1.
Lim, E. (2007b). Kaesong Industrial Complex: History, Pending Issues, and Outlook. Seoul.
Lim, E. (2009). Stalled Inter-Korean Relations & the Impact on the Kaesong Industrial Complex. ICNK Forum 09-2-11-1.
Lim, K.; Lim, S. (2005). Strategies for Development of a North Korean Special Economic Zone through Attracting Foreign Investment. Seoul: KINU – Korea institute of National Unification.
Lim, S.; Lim, K. (2006). Special Economic Zones as Survival Strategy of North Korea. North Korean Review 2006: 47 – 61.
Ministry of Unification (2006). Introduction to & Implications of Gaesong Industrial Complex Project. Power-Point-Presentation April 2006.
Ministry of Unification (2007). The Era of USD 100 Production Begins in Gaesong Industrial Complex. Seoul: Reference Material for the Press.
Ministry of Unification (2008). Welcome to GIC – Gaesong Industrial Complex Development Project. flyer.
Ministry of Unification (2010). Exchanges & Cooperation: Kaesong Industrial Zone. Available at: http://www.unikorea.go.kr/eng/default.jsp?pgname=AFFexchanges_gaeseong. Accessed 27 May 2013.
Nam, S. (2001). Theory and Practice: Kaesong and Inter-Korean Economic Cooperation. East Asian Review 13(1): 67 – 88.
Nam, C. (2005). Free economic and trade areas (FETA). as an instrument of economic transformation: the North Korean experience of Rajin-Sonbong. In: Friedrich, P. (ed.). Regional competition under transformation conditions: 195-210. Neubiberg.
Nanto, D.; Mayin, M. (2007). The Kaesong North-South Korean Industrial Complex. CRS Report for Congress, July 19, 2007.
Oh, S. (2002). Industrial Cooperation between South and North Korea, Korea Institute for Industrial Economics and Trade. KIET Occasional Paper No. 52, December 2002.
Park, S. (2004a). Creating a Visible Bridge: The Economic Impact of Kaesong Industrial Complex Construction. East Asian Review 16(3): 87 – 104.
Park, S. (2004b). An Analysis of Economic Effects of the Kaesong Industrial Park. Vantage Point August: 40 – 50.
Petrov, Leonid (2008). President Lee Myung-bak’s North Korea Policy: Denuclearisation or Disengagement? Policy Forum Online 08-025A: March 27. Available at: www.nautilus.org/fora/security/08025Petrov.html. Accessed 27 May 2013.
Seliger, B. (2004). Nordkorea: Reformen im Sozialismus oder Reform des Sozialismus? Orientierungen zur Wirtschafts- und Gesellschaftspolitik 99(1): 71-76.
Seliger, B. (2006). Towards a North Korea boom? Special Economic Zones in North Korea and their Effects on the North and South Korean Economies. In: Oh, Y. et al. (ed.). The Unification Research and Strategy in Korea and Germany: Affinity and Specifity: 93-122.
Wrobel, R. (2007). North Korea after the Nuclear Crisis: The Future of the Economic Reforms. Post Communist Economies 12(4): 483 – 504.
Wrobel, R. (2010). Kaesong Industrial Complex: The Centre Piece of Inter-Korean Cooperation at a Turning Point. East Asia: Comparative Perspective 9(1): 7-47.
Yonhap News Agency (2010). N. Korea said to want to keep Kaesong complex running. Available at: http://english.yonhapnews.co.kr/northkorea/2010/05/31/92/0401000000AEN20100531008400315F.HTML. Accessed 27 May 2013.
WROBEL, R. M. (2020). Ten years of Kaesong Industrial Complex: a brief history of the last economic cooperation project of the Korean peninsula. Economic and Environmental Studies, 14(2 (30), 125–147. Retrieved from https://czasopisma.uni.opole.pl/index.php/ees/article/view/2872
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