Mick Hartley

South Korean President Park Geun-hye has surprised everyone by closing down the Kaesong Industrial Complex: the collab0rative economic development founded in 2002 as part of South Korea's Sunshine Policy, where hi-tech South Korean firms employed North Korean workers just over the DMZ. It may have seemed like a good idea at the time, but in fact - and predictably - the workers were in effect slave labourers, while the proceeds went straight into Kim Jong-un's coffers. 

Here's the statement from the South Korean Ministry of Unification:

□ North Korea has pushed ahead with the extremely provocative act of launching a long-range missile on the heels of its 4^th nuclear test, showing disregard for the repeated warnings of the international community and the suffering of its people.

□ North Korea’s provocations are a direct challenge to peace and stability on the Korean Peninsula and in the international community and its actions are absolutely unacceptable. Notwithstanding international efforts to deter North Korea from developing its nuclear capabilities and long-range missiles,

North Korea has declared that it would follow up on its recent provocations with additional nuclear tests and missile launches, thereby not even showing the slightest intent to forgo the development of its nuclear and missile capabilities.

The status quo is not static, as North Korea’s nuclear capabilities will be upgraded, all but leading to a catastrophic disaster. If left unattended, North Korea’s nuclear and missile development will lead to a fundamental imbalance in and threat to the security landscape of Northeast Asia, not to mention the Korean Peninsula, and the countries of this region will be left with no choice but to take measures to ensure their own survival and shore up their security, and there are concerns that this could eventually even lead to a nuclear domino effect.

□ Under these grave circumstances, it is clear that the existing approach will not work in discomfiting North Korea’s nuclear and missile development plans. Accordingly, what is in order is a vigorous response together with the international community that, for sure, exacts a price for North Korea’s misguided actions, as well as extraordinary measures that compel North Korea to give up its nuclear capabilities and change its ways.

□ At a time when the international community is seeking sanctions in the wake of North Korea’s violation of UN Security Council resolutions with its nuclear test and long-range missile launch, there is a need for Korea, as a key party, to show leadership in taking part in these moves.

□ Over the years, our Government has been working to continue maintaining the Gaeseong Industrial Complex despite North Korea’s repeated provocations and under extreme state of affairs, all with a view to assisting the lives of the North Korean people, providing impetus to lifting up the North Korean economy, and achieving the shared progress for both South and North Korea. We have also made every effort to move the Gaeseong Industrial Complex forward under the position that it should be developed in conformity with international norms.

□ However, such assistance and the efforts of our Government have ultimately been wrongly harnessed in the service of upgrading North Korea’s nuclear weapons and long-range missiles.

To date, the total amount of cash that flowed into North Korea through the Gaeseong Industrial Complex is 616 billion won (560 million dollars), with 132 billion won (120 million dollars) in cash having flowed into North Korea last year alone, and the Government and the private sector have invested a total of 1.019 trillion won. It appears that such funds have not been used to pave the way to peace as the international community had hoped, but rather to upgrade its nuclear weapons and long-range missiles.

This tramples on the efforts of the Korean Government and the 124 businesses that have set up shop in the Gaeseong Industrial Complex, and puts at risk the lives and safety of the Korean people.

□ Today, in order to stop funds of the Gaeoseong Industrial Complex from being used to support the development of North Korea’s nuclear and missile capabilities, and to prevent our businesses from suffering, the Government has decided to completely shut down the Gaeseong Industrial Complex.

That's telling 'em. Marcus Noland:

When Park came to power Pyongyang greeted her with invective and provocations. The subtext, illustrated with endless crude sexist propaganda, seemed to be that she was a girl and would be a pushover. She has proved to have a stiffer backbone than either Pyongyang or I expected.

Admittedly Kaesong has closed before – back in 2013 – when the North withdrew their 53,000 workers as tension between the two Koreas escalated. This time it looks more serious though, not least because it's the South who are doing the closing: it isn't, in other words, just another act of petulance by the Corpulent Leader.

Joshua Stanton at One Free Korea:

Year after year, and almost alone, I have argued that the Kaesong Industrial Park was incompatible with U.N. Security Council resolutions sanctioning Pyongyang. At Kaesong, “South Korea has 124 companies … employing 54,700 North Korean workers … whose wages are paid to a North Korean state agency.” All told, those fees, taxes, and “wages,” which the North Korean workers probably never saw after Kim Jong-un took his cut, totaled $110 million last year alone.

Contrary to Kaesong’s founding purpose of promoting North-South engagement and people-to-people contact, the workers were heavily supervised and prohibited from direct action with their South Korean bosses, who had to relay their directives through North Korean state minders. And because Seoul never really knew how Kim Jong-un used the money, I argued that Kaesong was a violation of U.N. Security Council resolutions that required it to know, and to “ensure” that they money was not used for prohibited weapons programs….

By closing Kaesong, Seoul can now call on other nations to enforce sanctions without having those nations laugh in Seoul’s face… Seoul’s admission today will make it almost legally impossible for Seoul to reopen Kaesong again under similar arrangements, now that it has admitted, in effect, that those arrangements were in violation of the Security Council’s resolutions. But if Pyongyang ever becomes serious about engagement, change, and reform, perhaps both sides can agree to reopen Kaesong on the condition that all of those wages and taxes are paid in kind, as food aid, distributed to North Korea’s hungry, by the World Food Program.

Dream on. And, God willing, good riddance to the Sunshine Policy, which died today.

That the closure has surprised and angered North Korea is clear from their response:

North Korea has vowed to cut two key communication hotlines with the South, amid rising tensions after Pyongyang's recent rocket and nuclear tests.

It comes after Seoul suspended its operations at the jointly-run Kaesong industrial complex in the North.

Kaesong is one of the last points of co-operation between the two Koreas and a key source of revenue for Pyongyang.

The North has called the shutdown "a declaration of war" and has designated Kaesong as a military zone….

On Thursday, Pyongyang vowed to seize the assets of South Korean companies in Kaesong, and said all workers from the south had to leave by 17:30 local time (08:30 GMT).

South Korean companies had already started withdrawing managers, equipment and stock after Seoul announced the suspension.