North Korea resumes business talks with Seoul

The United Nations Security Council recently tightened sanctions against North Korea in response to its nuclear and missile tests and war threats.

Despite the rising tensions over North Korea's nuclear and missile programs, the two Koreas left open the possibility of business negotiations.

“Today, we received a letter from North Korea that allows 16 South Koreans to visit North Korea for inter-Korean talks that will take place on July 2,” South Korean unification official Chun Hae Sung said Tuesday.

The spokesman said it would allow South Korean non-governmental organizations (NGOs) to resume deliveries of construction materials and equipment to North Korea.

South Korean NGOs have been delivering humanitarian supplies but Seoul restricted the delivery of construction materials and equipment after tensions rose over North Korea's missile and nuclear tests.

“We will be relaxing the delivery restrictions on a step-by-step basis, but we will continue to ban South Koreans visiting North Korea,” the unification spokesman added.

The negotiations will focus on Gaeseong industrial park in North Korea, where thousands of North Koreans work in factories owned by South Korean companies.

In May, the closure of the border closure and detention of a South Korean alarmed South Korean businessmen operating factories in Gaeseong industrial park.

At talks on June 11, North Korea notified South Korea it wanted to increase the monthly wage to US$300, up from the current US$70.

North Korea has backed down after the UN tightened sanctions, Seoul-based North Korean watchers said.

“North Korea must be painfully aware that it needs to secure foreign exchange sources with South Korea before the sanctions dry up additional foreign reserves,” OpenNews for North Korea, a local website, said in an editorial.

The arrangement normally brings North Korea about US$500 million a year. Meanwhile, its trade with China trade has soared, provoking questions about whether the sanctions will work unless China pulls the plug.

Few expect the July 2 talks to produce a tangible outcome.

Dong Yong Seung, senior researcher of Samsung Economic Research Institute, said there would be little surprise if no agreement is reached.

“Still, there is one thing clear from the talks: both Koreas have come to a mutual recognition that neither the North nor the South want Gaesung to shut down,” he said.

South Korean businessmen said the Gaeseong operations may be replaced with contract workers in Vietnam, Indonesia or China.

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