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Gov't provides 74 pct of earmarked support to Kaesong complex firms

All Headlines 14:09 September 05, 2016

SEOUL, Sept. 5 (Yonhap) -- South Korea said Monday it has provided 74 percent of earmarked support funds to local firms that operated factories at the now-shuttered joint industrial park in North Korea to help cover their financial losses.

The government has offered 376.7 billion won (US$340.1 million) out of about 500 billion won in state funds to South Korean companies that have factories inside the Kaesong Industrial Complex, according to Seoul's unification ministry.

Seoul shut down the factory zone in the North's border city of Kaesong on Feb. 10 in response to Pyongyang's January nuclear test and long-range rocket launch in the following month.

The decision came amid concerns that money generated from the factory zone is bankrolling the North's nuclear and missile programs.

The shutdown of the complex may have caused 1.5 trillion won in losses, according to local firms, adding that the government's financial support measures are not sufficient.

The complex, which opened in 2004, had served as a major revenue source for the cash-strapped North.

A total of 124 South Korean companies operated in the zone, some 50 kilometers northwest of Seoul, employing more than 54,000 North Korean workers to produce labor-intensive goods, such as clothes and utensils.

"The government plans to help firms normalize their businesses by providing support in a swift manner," Jeong Joon-hee, ministry spokesman, said at a regular press briefing.

Gov't provides 74 pct of earmarked support to Kaesong complex firms - 1

sooyeon@yna.co.kr
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