South Korea said Friday it will expand compensation for hundreds of domestic companies with huge losses stemming from investments in inter-Korean projects suspended due to political tension.
The government plans to offer 66 billion won (US$59 million) to the 124 firms that operated factories at the Kaseong Industrial Complex, according to the Unification Ministry.
"The measure is meant to fulfill the state responsibility for those companies which have suffered from unexpected business setbacks due to a shift in the government's policy decisions," the ministry said in a statement.
It has already been doling out 517.3 billion won in reparations for the firms in a decision made shortly after the shutdown of the industrial zone early last year. At that time, the conservative Park Geun-hye administration abruptly closed the complex, once a token of inter-Korean economic cooperation, in response to the North's fourth nuclear test.
|In this file photo, truck-loaded goods are transported out of the Kaesong Industrial Complex after the 2016 decision by South Korea to shut it down. (Yonhap)|
An association of the relevant firms, mostly manufacturing such labor-intensive goods as clothes and utensils, claimed that they incurred more than 1.5 trillion won in losses.
After its own survey, however, the government put the estimated damage at 786.1 billion won.
With the additional support, the ministry said, 74.2 percent of the damage will be covered.
The affected companies are not satisfied with the amount.
"It falls far short of what we expected," said Shin Han-yong, the head of the association's emergency committee. He said the group will hold a meeting over the issue on Monday and deliver its stance to the government.
|South Korea's Vice Unification Minister Chun Hae-sung announces a decision to offer additional compensation for companies that operated at the Kaesong Industrial Complex during a press briefing in Seoul on Nov. 10, 2017 (Yonhap)|
Vice Unification Minister Chun Hae-sung made clear that there is no plan for further state compensation.
"(The government) will continue efforts to collect opinions and communicate with the companies, rather than (considering) additional support," he told reporters.
The new measure was based on "sufficient" consultations among relevant government agencies, he pointed out.
He expressed hope that it will serve as a chance for the government and those companies to work together for the future of inter-Korean economic cooperation.
The ministry also announced plans to help local companies, involved in other inter-Korean business projects, that have suffered losses from the 2008 halt to the Mount Kumgang tour program and the 2010 bilateral economic sanctions on Pyongyang, known as the May 24th Measure.
It would mark the government's first direct financial support for those businesses harmed by political situations.
"We have to conduct a related survey. But it's estimated that more than 900 of about 1,000 companies with inter-Korean businesses will be eligible for the assistance," a ministry official said.
Seoul abandoned the Mount Kumgang tour business following the killing of a South Korean tourist there by a North Korean soldier. The May 24th Measure was introduced to punish the North for its deadly torpedo attack on a South Korean warship near the Yellow Sea maritime border.
|This file photo shows the Kaesong Industrial Complex, the now-shuttered inter-Korean factory zone in North Korea's border city of Kaesong. (Yonhap)|
Kim Jung-mi email@example.com