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The government is considering giving more support to hard-pressed South Korean companies with factories in an inter-Korean factory park located in the North, an official said Thursday.
The unification ministry source said that while Seoul does not plan to alter the contract regarding the return of insurance money given to companies prior to the reopening of the Gaeseong Industrial Complex on Sept. 16, it is nevertheless looking at ways to alleviate their financial plight.
"Discussions are underway within the government on what actions can be taken," said the official, who declined to be identified.
Seoul had already given companies access to low interest loans, waivers on payment of utility fees and tax breaks.
Of the 123 companies at Gaeseong, 46 have received a combined 148.5 billion won ($139.4 million) in insurance money from the state-run Export-Import Bank of Korea (Eximbank).
Many of these companies have been asking Seoul for a reprieve or a grace period to repay the insurance money, claiming they do not have the necessary funds to pay back the money as dictated by Eximbank. The deadline for repayment had been set for Tuesday, but only 10 companies complied, returning some 30 billion won.
Insurance money that came from a cooperation fund controlled by the government was given to companies when there was the likelihood that all operations at the factory park would be halted permanently. Work at Gaeseong came to a screeching halt in early April amid a spike in tensions on the Korean Peninsula.
Besides reviewing the option of giving additional support to Gaeseong companies, the official said discussions will be held to see if local companies with business operations at the Mount Kumgang resort and other parts of North Korea also need assistance.
All business operations at the mountain resort came to a halt in July 2008 when a North Korean guard shot and killed a South Korean tourist. Companies in other parts of North Korea were told to pull out after Seoul forbade all business tie-ups with the communist country other than those taking place in Gaeseong, after it accused the North of sinking one of its warships in March 2010. (Yonhap News)
The unification ministry source said that while Seoul does not plan to alter the contract regarding the return of insurance money given to companies prior to the reopening of the Gaeseong Industrial Complex on Sept. 16, it is nevertheless looking at ways to alleviate their financial plight.
"Discussions are underway within the government on what actions can be taken," said the official, who declined to be identified.
Seoul had already given companies access to low interest loans, waivers on payment of utility fees and tax breaks.
Of the 123 companies at Gaeseong, 46 have received a combined 148.5 billion won ($139.4 million) in insurance money from the state-run Export-Import Bank of Korea (Eximbank).
Many of these companies have been asking Seoul for a reprieve or a grace period to repay the insurance money, claiming they do not have the necessary funds to pay back the money as dictated by Eximbank. The deadline for repayment had been set for Tuesday, but only 10 companies complied, returning some 30 billion won.
Insurance money that came from a cooperation fund controlled by the government was given to companies when there was the likelihood that all operations at the factory park would be halted permanently. Work at Gaeseong came to a screeching halt in early April amid a spike in tensions on the Korean Peninsula.
Besides reviewing the option of giving additional support to Gaeseong companies, the official said discussions will be held to see if local companies with business operations at the Mount Kumgang resort and other parts of North Korea also need assistance.
All business operations at the mountain resort came to a halt in July 2008 when a North Korean guard shot and killed a South Korean tourist. Companies in other parts of North Korea were told to pull out after Seoul forbade all business tie-ups with the communist country other than those taking place in Gaeseong, after it accused the North of sinking one of its warships in March 2010. (Yonhap News)
