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Seoul mulls options to defuse Kaesong stalemate

South Korea is reviewing all options to break the deadlock over the suspension of an inter-Korean industrial complex and minimize the damage on local firms operating there, the unification ministry said Monday.

Factories in the complex in the North Korean border city of Kaesong have been idle since April 9, when Pyongyang pulled out all of its 53,000 laborers. The North has remained resolute in blaming South Korean provocations for the current impasse, raising concerns that there would be no resolution to the standoff.

"The government has been asking the North to take immediate action to honor its pledge, but so far, no change has occurred which is very regrettable," Unification Ministry spokesman Kim Hyung-suk said during a press briefing. "The North signed agreements in the past to guarantee investments and the free movement of people to-and-from the complex."

The government has worked with companies by respecting their views, but with the North failing to make any changes, there is a need to check various measures that can be pursued, he said.

Amid the prolonged suspension, 123 companies with factories at Kaesong reported that overseas business partners have been moving to cancel orders and demanding the termination on existing contracts. Such a move is affecting the overall health of companies who have been warning that unless normal operations resume, many will go bankrupt.

Starting on April 3, all South Korean personnel and cargo have been barred from crossing the demilitarized zone to go to Kaesong, although no such restrictions have been placed for people leaving the complex to return home.

"The government and the National Assembly have been looking at various options to help the companies affected, but unless things return to normal soon, any measures will be nothing more than stopgap attempts that will not save companies," representatives from the Kaesong Industrial Complex Companies Association claimed.

Companies have been calling on Seoul to engage Pyongyang in dialogue for some time, and South Korean President Park Geun-hye, proposed talks on April 11. The North, however, rejected such offers as being insincere and motivated by underhanded tactics to "pass the buck" to Pyongyang.

A report by the Korean Central News Agency argued that all calls for talks made by Seoul and Washington are nothing more than a ploy to crush the North, and that the U.S., in particular, has been threatening to attack the communist country with nuclear weapons for decades.

"All the world knows that the U.S. has been using dialogue as a tool to crush the North," the KCNA said. It said, notwithstanding such challenges, Pyongyang is committed to strengthening its nuclear deterrence and to confront aggression head on. The country has detonated three nuclear devices since 2006, with the last being tested on Feb. 12.

South Korean businesses had also hoped that the North will lift its travel ban after the annual Foal Eagle exercises are concluded at the end of the month, yet there have been growing worries that this may not happen.

Reflecting this, the Rodong Sinmun, an organ of the ruling Workers' Party of Korea said in an article monitored in Seoul earlier in the day that no matter what excuses and commotions are raised by Seoul, it cannot deflect blame for the deterioration of conditions at the industrial complex. Pyongyang, last week, had rejected requests made by two groups of South Korean businessmen to visit the complex, citing continued provocations by the South.

The ministry spokesman added that besides talks that are underway at the government level, proposals are being made by lawmakers to better handle the problems at hand.

Lawmakers such as Rep. Jung Cheong-rae of the liberal Democratic United Party forwarded a bill calling for emergency relief for businesses engaged in inter-Korean economic cooperation. Others have called for using the South-North cooperation fund and to get local commercial banks to do more and to give loans to companies who are strapped for cash.

"Every option will be discussed at parliamentary subcommittees that can result in agreements being reached," Kim said, adding that the ministry hopes for a positive outcome.

Other government officials said that Seoul remains committed to normalizing operations at Kaesong as well as safeguarding the lives of its citizens and their property.

"Various cards have been placed on the table and are being examined," said an official, who declined to be identified.

He said the South may pursue a policy of getting the North to allow goods made at Kaesong to be brought south so they can help companies to some extent. Because no trucks have been allowed into Kaesong since the passage restrictions went into effect, goods that were made after the ban are still at the border town.

It can also continue to ask the North to allow representatives from South Korea's businesses community to visit Kaesong, so they can deliver food, and if possible, hold talks with North Korean officials. Pyongyang, so far, snubbed two requests for visits last week.

There are some 188 South Koreans at Kaesong with two having returned south during the day. Another eight are expected to cross over the demarcation line on Tuesday. Companies have said that with no cargo coming in from the South, food supplies have fallen sharply, making it difficult for people to stay at the complex. Normally there are some 850 South Koreans at Kaesong, which first started making products in late 2004. (Yonhap News)