A Capitalist Enclave in North Korea Survives - New York Times
« While tensions on the Korean Peninsula are at their highest point in years over the sinking of a South Korean warship, the North continues to allow the Southerners to enter the park, the Kaesong Industrial Complex, where 121 mostly South Korean companies employ 44,000 North Korean workers.At a time when the Koreas have traded threats of military confrontation and cut most economic and diplomatic ties, the Kaesong complex has remained a conspicuous exception. The complex, the largest economic link created during a relaxation of inter-Korean tensions almost a decade ago, has continued to operate even after the sinking in March of the warship, the Cheonan, and the recent closing of other joint projects.
For the isolated North, it is a source of desperately needed jobs and hard currency, pumping $50 million per month into the collapsed North Korean economy. North Korea watchers say it is also one of the few economic successes that the government has to show its people, at a time when the North’s ailing leader, Kim Jong-il, appears to be engineering the succession of his third son, Kim Jong-un.
“The leadership knows that unless it can raise people’s livelihoods, the succession may fail,” said Lim Eul-chul, a professor of North Korean studies at Kyungnam University in Seoul.
For the South’s vibrant economy, the park’s $250 million annual output is just a drop in the bucket. Kaesong has more emotional significance as a symbol that the two Koreas may one day peacefully reunify. Even the administration of President Lee Myung-bak, who has taken a harder line against the North, has been careful to keep the park operating to convey to the North that “the door remains open for improving ties,” as one senior official put it.
South Korean companies say they were drawn to the park by the prospect of the North’s 24 million residents’ becoming a pool of low-cost, Korean-speaking labor. »
