North and South Koreans returned to work yesterday at a jointly run factory park after a five-month shutdown triggered by rising animosity between the rivals, with some companies quickly resuming production and others getting their equipment ready.
South Korean business owners who have lost millions of dollars because of the hiatus say they will need several months to recover.
“I feel good about the park’s resumption, but I also have a heavy heart,” said Sung Hyun-sang, president of apparel manufacturer Mansun Corp, which has lost about 7 billion won (US$6.4 million) because of the shutdown at the Kaesong factory complex. “We’ve suffered too much damage.”
About 800 South Korean managers and tens of thousands of North Korean workers began returning yesterday to the factories at the Kaesong park, just north of the Demilitarized Zone.
The reopening is a sign that relations between the two Koreas are warming after a spring that saw threats of nuclear war from Pyongyang.
Among businessmen at Kaesong, many of whom operate small or mid-sized firms, there is a nagging worry about the future. The companies at Kaesong say they have lost a combined total of about 1 trillion won over the past five months and may need up to a year to get their businesses back on track.
About 1,000 of Mansun’s 1,350 North Korean employees returned to work and tested factory equipment. They were to start cutting fabric and doing sewing work by machine later in the day, said Lee Suk-ja, one of the firm’s four South Korean managers.
“They were pleased to see us again. It was like meeting them for the first time,” Lee said in a telephone interview from Kaesong. “Everyone here is extremely busy today.”
The park, established in 2004 during a period of warming ties between the Koreas, was considered a test case for reunification. It combined South Korean knowledge and technology with cheap North Korean labor. It was also the last major cross-border cooperation project before Pyongyang withdrew its 53,000 workers in early April to protest annual military drills between Seoul and Washington and alleged insults against the country’s leadership.
“We felt disconsolate [about the North Koreans’ pullout] at first, but we didn’t know that it would last this long,” said Yeo Dongkoo, director at Sudo Corp, which produces handkerchiefs and scarves at Kaesong.
By the end of last year, the more than 120 South Korean firms with operations at Kaesong had produced US$2 billion in goods during the previous eight years.
The South Korean government provided about 150 billion won in insurance payments to 46 of those companies because of the shutdown, but they were required to return the money because the park has resumed operations, Seoul’s Unification Ministry said.
Kaesong’s reopening comes as tensions on the peninsula gradually ease, with the North dialing down its war rhetoric and seeking to restart various cooperation projects with South Korea. The two Koreas plan to hold a reunion of families separated by the Korean War next week for the first time in three years.
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