North, South Korea’s discuss Kaesong wage dispute

North Korea insists on unilaterally imposing pay rise for workers, Seoul wants joint decision

Photo by: Reuters
Photo by: Reuters

Updated Jul 28, 2015

North and South Korean officials hold talks to solve a protracted wage dispute at the jointly operated Kaesong factory complex in the North on Thursday.

The two Koreas disagree on minimum wages at the industrial zone as the North insists on raising its workers' wage unilaterally, but South Korea says a mutual decision is needed for the joint estate.

The minimum monthly wage at the complex is currently $70.35. Pyongyang wants to raise it to $74.00 next March.

Opened in 2004, the Kaesong factory estate is a special economic zone. 10 kilometres away from the heavily fortified border of North Korea, an estimated  54,000 North Koreans are working for 120 South Korean factories.

As an important source of income for the reclusive North, the factory complex has continued to operate despite the ongoing crisis between the two Koreas.

After more than a year, the South Korean government delegation met with their North Korean counterparts at the industrial zone.

The South's chief delegate and the head of the committee Lee Sang-Min said it will be first meeting with his North Korean counterpart Pak Chol-Su.

"Today's joint committee is the first one in about a year. We will discuss pending issues in terms of advanced normalization of the Kaesong Industrial Complex and strive to achieve the desired result," he quoted as saying by VOA.

The Kaesong industrial park is considered as the last major joint cooperation project between the two Koreas, and the companies from the South get cheap labour, in addition to  preferential loans and tax breaks from their government.  

The Kaesong Industrial Complex was temporarily closed by the North in 2013 following diplomatic and military tension, causing great financial losses for many companies.

North and South Korea are technically still at war, as the 1950-53 Korean War ended in an armed truce, not a peace treaty.

TRTWorld and agencies