A Moral Economy

On 16 September, the first South Korean trucks and buses rolled over the demarcation line separating the two countries after a five month hiatus, heading for the Kaesŏng industrial zone. Established in 2002, the industrial complex on North Korean soil is to serve as a collaborative effort to strengthen economic relations on the peninsula. Today, it is home to 123 South Korean factories and place of employment for over 50,000 North Koreans.

During the political tensions and expanded UN sanctions that followed P’yŏngyang’s nuclear test in February 2013, the North shut down Kaesŏng and withdrew all of its workers. Now, after Kim Jong-un’s military vapour seems to finally have subsided, the industrial zone has re-opened for business again. Enthusiasm isn’t exactly running high on either side of the border though.

To say that relations between the North and the South have always been rocky would probably be considered a huge understatement. Since the establishment of the demilitarized zone (DMZ) along the 38th parallel, there have been numerous incidents of infiltration and kidnappings, as well as violations of land border laws and military tensions. Games of nuclear blackmail and armament are on the usual agenda in the political dialogue. Existing bilateral projects that aim to improve relations, like the Kaesŏng industrial zone, are repeatedly weakened.

The project was revived, because both sides clearly profit from it. South Korean companies get to employ cheap, skilled labour that is fluent in Korean and produces for the Southern market. The economy of the Republic of Korea might not be in desperate need of a production zone like this, but it is a nice bonus. North Korea on the other hand is provided with a key source of foreign currency and gets to promote a development model that resembles China’s “economy-first-socialism”.

 Yes, it is difficult for the South to approach the North. It is after all a dictatorship that violates the most basic human rights and waves about with nuclear warheads. Economic co-operation is one of the most basic steps to promote diplomatic goals, but in the case of the countries, this co-operation has a strange undertone. The conflict on the peninsula is one of the few true relics of the Cold War – the struggle between capitalism and socialism. Lessons from Eastern Europe and Russia show us that this struggle may end in a way neither side had predicted, with the world still dealing with the aftermath of the collapse of state-socialism.

Reconciliation and co-operation are valuable goals, and I do not question them. However, what I do question is whether they can be attained by exploiting workers for the production of toys and electronics. Only the governments of the two countries seem to be benefiting from the Kaesŏng scheme, the people once again fall by the wayside.