Kaesong Industrial Complex Support Foundation Also Becomes History... Government Decides to Dissolve

On December 18 last year, the Demilitarized Zone (DMZ) of the western front and the Kaesong Industrial Complex area, where operations were suspended following the North's demolition of the liaison office in June 2020, viewed from the border area of Paju, Gyeonggi Province, are quiet.
[Image source=Yonhap News]

The Kaesong Industrial Complex Support Foundation under the Ministry of Unification will be dissolved. This comes about eight years after the suspension of the Kaesong Industrial Complex operations in February 2016. Accordingly, the Kaesong Industrial Complex is also expected to proceed toward complete closure in practice.

On the 4th, the Ministry of Unification announced that it decided at the end of last year to dissolve the Kaesong Industrial Complex Support Foundation. Since President Yoon Suk-yeol's order in July last year to 'break away from North Korea aid departments,' the foundation had been considered for restructuring, and this has now been finalized.

The foundation is scheduled to hold a board meeting soon to approve the dissolution plan.

The Kaesong Industrial Complex Support Foundation was launched in 2007 to support licensing, entry and exit management, labor, and facility management for companies operating in the Kaesong Industrial Complex.

However, since the suspension of the complex's operations, it has been effectively dormant. It is known that maintaining the foundation requires about 7 to 8 billion KRW annually, including personnel expenses.

Recently, as North Korean State Affairs Commission Chairman Kim Jong-un defined inter-Korean relations not as a 'kinship relationship' but as a 'hostile relationship between two states,' relations between the South and North have deteriorated, which is interpreted to have accelerated the dissolution. North Korea's continued unauthorized use of South Korean companies' facilities within the Kaesong Industrial Complex despite warnings from our government also appears to have influenced this decision.

The Ministry of Unification plans to continue supporting resident companies through private consignment even after dissolving the foundation.

This content was produced with the assistance of AI translation services.