SEJONG COMMENTARY

	THE SEJONG INSTITUTE
	The Sejong Institute is a foreign policy research institute, a leading think tank for Korea's national strategy in the 21st century

(This article is based on the author's personal opinion and does not reflect the views of the Sejong Institute.)

No. 273

August 19, 2013

〈Translated from Korean〉

The Agreement on the Normalization of the Kaesung Industrial Complex: Analysis and Prospects

South and North Korea finally agreed on the normalization of the KIC on August 14, the 133th day since North Korea restricted South Korean’s entry to the Kaesung Industrial Complex (KIC). Although North Korea had brought up the Mt. Kumkang tour issue along with the normalization agreement, it accepted South Korea’s proposal of resuming reunions of families separated by the Korean War. Despite the high tensions arose in the first-half of the year,

by Research Fellow

Dr. Soon-bo Moon

sbmoon@sejong.org

the atmosphere surrounding the two Korea has opened a new era of reconciliation and cooperation in the Korean Peninsula, like snow melt in spring. However, as long as North Korea shows no intention in becoming a member of the international community through reform and opening-up, South Korea should be aware of being overly sanguine about the current situation created by fatigue resulted from the never-ending confrontation with the North.

Both South and North Korea agreed to normalize the Kaesong Industrial Complex and signed a five-point agreement on August 14, after seven rounds of working-level negotiations. Although the South and North had had a difficult time resolving differences in opinion regarding issues surrounding the responsibility over the shutdown of the KIC and the reoccurrence prevention measures, they avoided controversies in the agreement by using ‘creative ambiguity.’ For example, they made ambiguous compromises in the agreement by excluding the responsibility issue over the shutdown of the KIC and stating the principle agent as “the South and the North” in the reoccurrence prevention measures. The main motives for the agreement on the normalization of the KIC seem to be the increased political and economic pressures and both sides’ realization of the fact that neither side would benefit from the closure of the KIC. North Korea has officially declared that it would put efforts for the KIC normalization process and betterment of the Inter-Korean relations. It has also accepted the South Korean government’s proposal about resuming reunions of the separated families around Chuseok. Has North Korea really changed its attitude? It may seem as a change, but not yet a meaningful one. The recent changes in North Korea’s attitude rather seem as tactical retreats reflecting its worsened economy conditions.

During the last plenary meeting of the Worker’s Party of Central committee held in the end of March, the North Korean regime officially set forth a new strategic line called Byeongjinnoseon which aims to pursue nuclear and economic development. With the third nuclear experiment carried out in February, the regime now declares that its nuclear program has reached a distinguishing level in the development process. The problem is North Korea’s ongoing economic downturn. Giving up on the KIC, which makes annual profits of $8000-9000, is especially difficult for North Korea, because it now has lost financial backers due to the confrontation with the South Korean government and sanctions placed by the International Community. These economical reasons have made the North Korean regime to seek response measures and sign the agreement in accordance to  the South Korean  government’s proposals while protecting its self-esteem. Int his sense, it is no surprising to see North Korea playing a tactic of bringing up the resumption of the Mt. Kumkang tour along with the separated family reunion.

The article 4 discussing the ‘Inter-Korea Joint Committee’ is the most important article in the agreement. The Inter-Korean Joint Committee is a standing consultative committee established upon the agreement of both South and North Korea to carry out KIC related tasks such the implementation of the agreement. Although, in the past, there was a management committee, it was non-governmental. However, the Inter-Korea Joint Committee was established upon the agreement of the two Korea with the aim of creating a joint operation system for the KIC. A source from the Ministry of Unification said that this committee would structurally prevent North Korea from carrying forward unilateral actions such as restricting the entry to the KIC. Would that really work? The question still remains.

Although there was a joint consultative committee in the past, the committee fell apart as it lost function due to North Korea’s indifference in implementing agreements and provocations against South Korea using a tension-thawing atmosphere.

After signing the South-North 7.4 Joint Statement in 1972, South and North Korea agreed in establishing the ‘South-North Coordination Committee.’ The South-North Coordination Committee was a consultative committee established with the political aims of pursuing the items written in the 7.4 Statement, improving and developing the Inter-Korean relations, and solving issues surrounding unification. At the time of the establishment, the committee was expected to function as a systematic mechanism that would improve the Inter-Korean relations in general, however, South Korea gained nothing from establishing the committee, but severe provocations from the North. North Korea did not have a sincere will to improve the Inter-Korean relations in the first place. It used the tension-thawing atmosphere and South Koreans’ lack of security awareness in carrying out large-scale provocations against South Korea.

The investigation result of Moon Sei-gwang, who attempted to assassinate President Park Chung-hee on August 15, 1974 (First lady Yook was killed), had revealed that the attempt was orchestrated by North Korea in November 1972, right after the declaration of the 7.4 Joint Statement. North Korea carried out such a bold provocation while exploiting South Korea’s low security awareness created by the détente atmosphere. North Korea has become more hostile and aggressive. For instance, in addition to the assassination attempt, North Korea has dug secret underground tunnels into South Korea for invasion purposes, sent out spies in the sea, and attacked unarmed South Korean fishing fleets.

Having these past incidents, it is uncertain that the Inter-Korean Joint Committee would function as it should. In short, there still lack legal and systematic measures to prevent North Korea from shutting down the KIC.

The principles that the South Korean government maintained in its policy toward North Korea regarding the KIC incident were proper response measures, because they have made North Korea to change its strong stance in the beginning. However, the time has not yet been ripe to conclude the changes in North Korea’s attitude as intrinsic strategic changes. The North Korean government did take a step back in the recent summit, but, the South Korean gave away far more. For future negotiations, the South Korean government should prevent these concessions from being perceived as vulnerabilities to the eyes of North Korea. The negotiations on the normalization of the KIC will now become even more important in future Inter-Korean dialogues. The South Korean government should put an emphasis in identifying whether North Korea possesses sincerity in improving the Inter-Korean relations, lay down principles that determine the level of Inter-Korean cooperation and aid in accordance to significant changes visibly occurring in North Korea’s behavior, and follow these principles in all circumstances. If South Korea continues being reluctant to the national security, feeling fatigue and relief resulted from the never-ending confrontation with the North and tension-thawing atmosphere, South Korea will invite another provocation from North Korea.

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