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A week after purge, business as usual at N.Korean factory park

Source: Reuters - Thu, 19 Dec 2013 09:40 AM
Author: Reuters
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By Ju-min Park and Hyun Young Yi

SEOUL, Dec 19 (Reuters) - North Korea hosted a group of foreign officials and journalists on Thursday in a rare opening of an industrial zone jointly run with the South, a week after the regime executed the powerful uncle of leader Kim Jong Un.

North and South Korean officials also held meetings at the Kaesong complex on Thursday to discuss the operations of the factory park, their first contact since the purge of Jang Song Thaek, considered the second-most powerful man in the country.

There was no apparent sign of the upheaval in Pyongyang at Kaesong, 165 km (100 miles) south of the North Korean capital. A group of finance officials from the G20 economies who are participating in a conference in South Korea travelled across the heavily armed border separating the rival Koreas to tour factories run by 120 South Korean firms in Kaesong.

Foreign and South Korean journalists who accompanied them were led through the factories but were discouraged from speaking to North Koreans employed there. The workers showed little obvious interest in the rare visitors.

"Regardless of Jang's purge, North Korea will keep Kaesong running. To North Korea, Kaesong is the sole success model to attract foreign investments," said Lee Yong-hwa, an expert on North Korea's economy at the Hyundai Research Institute in Seoul.

Jang's death marks the biggest political upheaval since Kim inherited power after his father's death in 2011. South Korean President Park Geun-hye has described the purge as a "reign of terror".

Kim led events this week in Pyongyang marking the second anniversary of his father's death that highlighted continuity and loyalty to the family bloodline.

North Korea shut down Kaesong in April and kept it closed for five months, driving many of the South Korean firms that run manufacturing operations there to the brink of bankruptcy.

Both sides blamed the other for the shutdown.

Tensions eased in September. Kaesong was reopened and both sides pledged to work to make the project politically and economically sustainable and more appealing to international companies.

Tensions however persist. Last month, Pyongyang repeated a threat to turn Seoul into a "sea of fire" and attack the South's President Park.

The two sides remain technically at war since the 1950-53 Korean War was ended only by a ceasefire.

The Kaesong project, which employs about 46,000 North Koreans, is one of Pyongyang's few connections to the outside world and a source of much-needed hard currency.

Since it opened in 2004, the Kaesong complex has generated about $90 million annually in wages paid directly to the North's state agency that manages the zone. (Editing by Jack Kim and Raju Gopalakrishnan)

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