As Kaesong Industrial Complex (KIC) was
\ncompletely shut down on February 11th, it was suddenly announced that all South
\nKorean workers would be expelled. The sudden departure meant that materials and
\nproducts had to be left behind. In the wake of this move, South Korean
\ncompanies are in a state of shock over the losses they face. If one considers
\nthe stranded materials alone, the total costs add up to billions of KRW. <\/p>\n
The seed money for the facilities and \u201cI cannot even begin to fathom the \u201cThe sudden pullout doesn\u2019t At a related emergency government meeting on Friday, it was announced that loan repayment periods and tax payment deadlines would be A party involved with a food company that When asked about the insurance policy, this \u201cThere are a significant amount of \u201cIn some instances, the raw materials and The CEO of a pharmaceutical company tethered to the KIC remarked,”If the government doesn\u2019t step forward with swift and effective In this manner, many of the firm\u2019s As Kaesong Industrial Complex (KIC) was completely shut down on February 11th, it was suddenly announced that all South Korean workers would be expelled. The sudden departure meant that materials and products had to be left behind. In the wake of this move, South Korean companies are in a state of shock over the losses […]<\/p>\n","protected":false},"author":122,"featured_media":32259,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"wikipediapreview_detectlinks":true,"footnotes":""},"categories":[67],"tags":[],"class_list":["post-32257","post","type-post","status-publish","format-standard","has-post-thumbnail","category-news"],"yoast_head":"\n
\nequipment for South Korean companies in the Kaesong Industrial Complex amounted
\nto 1 trillion KRW (~U.S. 828 million). There has also been an estimate
\nthat if one includes the losses of subcontractors, the total loss for the South
\nKorean side is closer to 2 trillion KRW (~U.S. 1.65 billion). There is a joint
\nNorth-South insurance policy that guarantees 90% of claims up to 7 billion won,
\nbut only 60% of entities signed up for policies that cover the investment costs
\nfor their facilities. The remaining companies are expecting huge losses.<\/span> <\/p>\n
\nlosses I expect to see due to the closure of the KIC and the subsequent rapid
\nevacuation of South Korean workers. I honestly anticipate that I might need to
\ndeclare bankruptcy,” <\/span>the owner of a clothing company that had operated in the Kaesong Industrial Complex told Daily NK in a telephone conversation on February 12, <\/p>\n
\nmerely affect companies that were operating in the KIC. Traders and merchants
\nthat have a relationship with us and depend on us for materials and supplies
\nwill also be hit hard by this turn of events. Because this affects the
\ncredibility of our organization, many of our customers will likely sever ties.\u201d<\/span> <\/p>\n
\nextended. This response, according to the KIC clothing company head, “isn’t <\/span>substantially different from the policy launched in
\n2013.” However, the scale of this incident is significantly larger and demands a proportionally large response, he said.<\/span><\/p>\n
\nwas active in the KIC prior to the shutdown said that the South Korean
\ngovernment promised in 2013 to support the companies affected by the closure
\nwith \u201castronomical financial assistance,\u201d but that they still \u201c haven\u2019t seen a
\npenny out of that promise.\u201d<\/span> <\/p>\n
\nindividual said that costly premiums drive many small companies and their
\nassets to go uninsured, and that he has low expectations to see many
\ncompensation payouts from the North-South Joint Insurance program.<\/span> <\/p>\n
\ncompanies who are not going to get insurance payouts this time around. The
\ngovernment should actively support these companies,\u201d he asserted.<\/span> <\/p>\n
\nproducts left behind aren\u2019t the property of companies that operated in the KIC,
\nbut rather the property of their customers. Even if the northern side keeps the
\nfacilities and equipment, if they were to return some of our customer\u2019s
\nmaterials, it would go a long way to re-establishing trust.\u201d<\/span> <\/p>\n
\nmeasures to aid troubled South Korean companies, many will face crippling
\nfinancial problems and even bankruptcy. At bare minimum, the government should
\npresent a policy to help us continue production.\u201d<\/span> <\/p>\n
\nrepresentatives expressed frustration that they had worked very hard to build
\nup their companies, only to face the prospect of losing them due to events
\nwholly out of their control. There is a consensus among the companies that the
\ngovernment needs to come up with a plan in order to minimize the damage to the
\n124 firms that operated in Kaesong and the 5,000 firms that had a financial
\nrelationship with them. <\/span> <\/p>\n","protected":false},"excerpt":{"rendered":"