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Payouts Are Due as Early as Next Week
Inter-Korean Cooperation Insurance
Payouts Are Due as Early as Next Week
  • By matthew
  • August 5, 2013, 05:18
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Model Industrial Complex factories in Kaesong (Gaesong) Industrial Area. (photo courtesy of Mimura/Wikimedia Commons)
Model Industrial Complex factories in Kaesong (Gaesong) Industrial Area. (photo courtesy of Mimura/Wikimedia Commons)

 

Payments on inter-Korean Trade & Economic Cooperation Insurance worth about 272.3 billion won, which 110 firms in the Kaesong Industrial Complex (KIC) applied for, are scheduled to begin as early as next week.

Park Soo-Jin, deputy spokesperson for South Korea’s Ministry of Unification, said at a press conference on August 3, "The South and North Exchange and Cooperation Promotion Council is taking steps for payouts, and written deliberations will be finished by August 5. It seems that payments for the insurance will be made according to the resolution by the Council, but it is difficult to predict the exact outcome."

The Ministry of Unification held the Council on August 2, taking charge of written deliberations since then, after receiving applications for the insurance from South Korean firms operating at the KIC by July 30. When the resolution is made, it is expected that payouts for the insurance will be possible as early as next week since only simple administrative procedures are required.

But there is speculation that the unilateral closure of the KIC by Pyongyang will become a reality once the decision to pay for insurance is made, as the firms receiving insurance money can do nothing but hand over their ownership of assets in the zone to the North. In response, a government official said, "Seoul is waiting for Pyongyang's reply regarding this issue. The permanent shutdown of the Complex is not on the agenda."

The South Korean government will run the support centers for companies suffering from North Korea's extended shutdown of the KIC. The centers were established at the Kaesong Industrial Complex Project Support Directorate and the Kaesong Industrial Complex Support Foundation, and they are set up to solve those firms' problems through interpersonal interaction online, face-to-face, and on the phone. In addition, the city of Seoul is rolling up its administrative sleeves for them by hosting a presentation with the ministries concerned about support measures for Kaesong firms who suffer from a problem of selling finished products shipped from the KIC.