Two Koreas agree on Gaeseong normalization

Head of the South Korean working-level delegation Kim Ki-woong (R) and his North Korean counterpart Park Chol-su exchange written agreements at the Kaesong Industrial District Management Committee in Kaesong August 14, 2013.

GAESEONG - The two Koreas agreed Wednesday to take steps to reopen the Gaeseong factory park after 133 days of suspension, as the sides compromised on the key issue of how to prevent another closure in the future.

Under a five-point accord signed at the close of the seventh round of talks in Gaeseong, they will meet again "in the near future" to form a new joint committee to discuss compensation for businesses and ways to improve passage, communications and customs and how to protect South Koreans' assets in the border city.

"The South and North will prevent the Gaeseong complex from being halted again due to a passage restriction or employee withdrawal, and ensure its normal operation including South Koreans' stable passage, North Korean workers' normal attendance and corporate assets' protection without being affected by any political situation," the agreement reads.

Seoul apparently made concessions by agreeing to the "joint" safeguards. It previously insisted on Pyongyang's unilateral assurances that it would not shut off the district again.

Pyongyang, for its part, accepted other South Korean demands such as "institutional measures" to preclude any relapse, protect business investment, upgrade infrastructure, invite foreign firms and resolve any dispute.

"As for the (guarantor) part, it's not appropriate to use expressions like yield or retreat -- look at the substance," the South's chief negotiator Kim Ki-woong told reporters after the meeting.

"We all know who blocked passage and pulled out workers. What's to be guaranteed shows who will do it. In conclusion, I think our government has accomplished its original intention."

The two sides will put back on track the industrial zone after formulating the institutional measures through the envisioned panel, Kim said, without giving a time frame.

"For now the joint committee is critical," said Kim, director-general of inter-Korean cooperation district support at the Unification Ministry.

"It will basically handle all issues related to the complex through consultation and agreement between the two Koreas' governments. In other words, we have agreed to devise a system in which the two governments will run the complex together, thus structurally blocking North Korea from imposing unilateral measures."

Another ministry official said that the hard-won deal contained "three-layer" assurances for the uninterrupted operation of the industrial zone.

"Once the panel sets sail, things like what we saw in April can never happen again," he said on condition of anonymity due to the sensitivity of the matter.

President Park Geun-hye welcomed the agreement.

"I hope today's talks will create momentum for the inter-Korean relations to get a new start," she was quoted as saying by her public relations secretary Lee Jung-hyun.

"I expect South and North to make joint efforts toward the globalisation of the Gaeseong complex."

North Korea's chief delegate Park Chol-su expressed his satisfaction with the result.

"We can now deliver very good news to the Korean people," he told South Korean reporters.

"We have to move forward through follow-up consultations to contribute to the development and normalization of the industrial district," he said.

The breakthrough came after a battle of nerves since the sixth round of talks broke down on July 25 over who was responsible for the unprecedented, four-month freeze of the manufacturing zone and how to preclude any relapse.

Seoul demanded a pledge from Pyongyang not to block off the district again, whereas Pyongyang argued that such safeguards should be prepared by both sides.

Despite lingering differences, hopes had risen for the revival of the last remaining symbol of cross-border rapprochement, given the North's recent "forward-looking" attitude.

The South made what it called a "final" offer of dialogue on July 28, while pressing Pyongyang to budge by approving civilian aid for flood damage and the weak in the impoverished country and announcing plans to compensate businesses in exchange for their property in Gaeseong.

After a 10-day letup, the North on Aug. 7 accepted the proposal through the CPRK statement, saying it would lift the suspension and entry ban, and promising to "fully protect" the safety and assets of South Koreans.

In an apparently warmer atmosphere than earlier talks, the two Koreas traded new draft agreements and fine-tuned their positions throughout the latest round's five sessions.

Touching down in Gaeseong, Kim quietly said "Good to see you" to his counterpart Park Chol-su, who responded with a smile. During the past encounters they mostly exchanged no greetings or smiles but flat, ceremonial handshakes.

"The fact that today we sit face to face for the seventh time underscores that the problem that we representatives have to deal with is not simple at all," said Kim, director-general of inter-Korean cooperation district support at the Unification Ministry, as the morning session kicked off.

"As the old saying goes, where there is a will, there is a way. If we make efforts in unison for the future-oriented normalization of the Gaeseong complex, we will be able to overcome any problem, any difficulty."

The North's Park responded with a rosy outlook for the talks, pointing to good weather and preparations so far.

"If the South is actively engaged in discussions through today's meeting, a good outcome could be brought about ahead of tomorrow (Liberation Day)," said Park, vice director of the General Bureau of the Special Zone Development Guidance.

Businessmen, meanwhile, nervously awaited good news from across the border.

Early in the morning, about 10 company executives visited the Headquarters for Inter-Korean Dialogue in central Seoul, from where Kim's delegation departed for Gaeseong.

They were holding small banners calling for "guarantees for stable management activity at the complex" and "allowing trips to the North for facility maintenance and repair."

Some 30 South Korean managers and employees who were forced out of work turned up in the border city of Paju, waving to the delegation aboard a bus with a placard reading, "We want to work: the normalization of the Gaeseong industrial complex."

Now the attention is being shifted toward whether the breakthrough will help resuscitate other stalled inter-Korean projects such as reunions of separated families and tours to Mount Geumgang.

Pyongyang proposed separate talks with Seoul on resuming the two programs after their second round of Gaeseong talks on July 10. But they eventually decided to postpone the plan after the South only welcomed family meetings, saying it would opt to focus on the ongoing negotiations for the time being.

In a speech earlier in the day, Unification Minister Ryoo Kihl-jae expressed regret over the now-incalculable losses for companies engaged in the Mount Geumgang tour business.

"I feel sorry and desperate for the firms suffering damage. The government is trying to help alleviate their losses but there is a limit. I can't say here that there are some other ideas but we will try harder," he said at an event hosted by the Korean Council for Reconciliation and Cooperation, an association of some 200 political, civic and religious groups.

"Like the Gaeseong-based firms, those tied to Geumgang would hope for the resumption of the tour and lifting of the so-called May 24 sanctions. But that's related to inter-Korean relations, so please keep an eye on government policy."

In the wake of the North's 2010 attacks on the South's Cheonan corvette and Yeonpyeong Island, then-President Lee Myung-bak imposed measures to forbid cross-border trade, investment, travel and other exchanges.

Ryoo also said he was "confident" that the Gaeseong crisis would "provide a chance for the two Koreas to build trust."

Key points of inter-Korean agreement

The two Koreas agreed to

Prevent the Gaeseong complex from being halted again and ensure its normal operation without regard to any political situation

Ensure South Koreans' safety, protect invested assets and resolve passage, communications and customs issues

Ensure international-standard conditions for business and develop the park into a globally competitive industrial complex

Establish and run a joint committee to implement the agreement

Design institutional frameworks for safe passage and stay, and investment protection, and make efforts for businesses to repair facilities and resume operations

heeshin@heraldcorp.com