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$636 million fund set up to help Kaesong firms

May 3, 2013 at 12:36 AM   |   Comments

SEOUL, May 3 (UPI) -- South Korean regulators say 700 billion won ($636.5 million) in loans will be available to local firms affected by the idling of the Kaesong industrial complex.

The short-term emergency loan fund has been set up by South Korean banks, insurers, savings banks, credit card firms and other financial institutions to help meet cash shortages faced by any of the 123 South Korean firms that had operated the inter-Korean industrial complex in North Korea's border town of Kaesong, Yonhap News reported.

The 700 billion won fund would supplement a 300 billion won fund already available from the government to help the troubled companies in Kaesong.

Operations at the complex, the only economic link between the two Koreas, were suspended in early April after North Korea, in continuation of its threats against South Korea, pulled its 53,000 workers and banned the entry of South Korean representatives and supplies into the complex. South Korean efforts for a dialogue to resume operations at the complex have not succeeded thus far and most of its representatives staying at the complex have since returned home.

The loan fund was set up after South Korea's Financial Services Commission and its executive body the Financial Supervisory Service called on various financial institutions to offer special short-term loans to the firms based at the complex, Yonhap reported.

Only seven South Koreans remain at the complex to settle overdue wages and other outstanding issues with the North.

Output from the Kaesong complex, which began operations in 2004, had totaled $2.05 billion at the end of last year and had been a source of much economic benefit to North Korea.

The future of the complex remains unknown because tensions between the two Koreas have not eased.

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