Kaesong's contracts have been scrapped by the North
North Korea has announced that all contracts with the South for the Kaesong Industrial Complex are to be scrapped.
Kaesong is used by over 100 South Korean companies and employs around 38,000 North Koreans, giving North Korea a major source of income and South Korea a source for local and cheap labour.
North Korea wants to decide more policies in Kaesong such as tax, etc, and this is the North’s way of protesting to the South. Sanction hit North Korea should tread carefully and must think about the economic impact that it’s fondling with Kaesong will have. It seems the free market explorations the North has dabbled with have been unsatisfactory for the communist state, which suffers chronic food shortages and one of the poorest economies in the world.
However, Kaesong is also a risk to the North’s cloak of the grim realities that are of life in North Korea, as North Korean workers are able to mix with South Korean company workers in the industrial complex – which is also apparent with the recent incident with a South Korean citizen being arrested for apparently putting the North’s political system and trying to persuade a female North Korean to defect.
