Apparel and textile manufacturing is set to restart at North Korea’s Gaeseong Industrial Complex (GIC), also called Kaesong Industrial Park. Located just north of the South Korean border, the process of starting GIC will begin nearly five months after work was halted as tensions escalated between the two Koreas following a nuclear test done by North Korea in February this year.
The second meeting of the South-North Joint Committee for GIC, held recently decided that the GIC companies will begin testing machines, and resume operations thereafter, according to a press release by the South Korean Ministry of Unification.
Through the meeting, both the countries established a systematic framework, which will help the GIC become a stable industrial complex that has international competitive power. The GIC has 123 South Korean factories that together employ over 5,000 North Koreans. About 60 percent of these factories are engaged in manufacturing of fabric and apparel.
In order to compensate for the GIC companies’ financial losses, South and North Korea agreed to give the tax exemption benefit for the year 2013. The deadline for tax payment by the GIC companies for the year 2012 is now extended to the end of 2013.
Launched in 2003, GIC is largely financed by South Korea. In 2012, the complex produced $470 million worth of products, and was the biggest contributor to inter-Korean trade. The industrial zone is the last functioning inter-Korean joint project and is a major source of revenue for North Korea.
