pyongyang Geopolitical Risks Seen Easing
By Lee Hyo-sik
Staff Reporter
Leaders of the two Koreas agreed to expand cross-border investments and economic cooperation projects to establish a ``common economic community'' on the Korean Peninsula to help ease geopolitical risks in the region.
Analysts say the increased inter-Korean economic cooperation will help build a strong foundation for long-lasting peace on the peninsula and eventually for reunification between the two Koreas. They say a series of agreements aimed at boosting economic cooperation will provide South Korea with new investment opportunities, while helping to develop the North Korean economy.
In an eight-point joint declaration signed by South Korean President Roh Moo-hyun and his North Korean counterpart Kim Jong-il in Pyongyang on Thursday, the two sides agreed to end military hostility and significantly expand inter-Korean cooperation in politics, economy, denuclearization and other pending issues.
``If the two Koreas boost economic cooperation, they will become more economically interdependent," said Lee Sang-man, professor of the Department of Development and Cooperation for North Korea at Chungang University in Seoul. "It will act as a cornerstone for the creation of the common economic community on the Korean Peninsula.''
He said military tension between the South and the North has been the biggest stumbling block to a closer inter-Korean economic tie, adding it is meaningful that Roh and Kim reached a consensus on resolving most military issues for the increased economic cooperation.
Lee gave high marks to the two leaders for having agreed on a number of concrete economic projects, which he said will help bring the two economies closer and establish peace on the peninsula. ``I think South Korea was able to put all the issues it wanted to on the joint declaration aimed at boosting economic cooperation with the North," he said. "For instance, the two sides decided to upgrade the committee undertaking inter-Korean economic cooperation.''
The Ministry of Finance and Economy said that the agreement to boost economic cooperation between the two Koreas will provide a fresh catalyst for the easing of geopolitical risks in the peninsular.
At the same time, it expects the improvement in inter-Korean relations will have a positive impact on boosting the country's sovereign ratings. The ministry plans to draw up details to chart action plans for the implementation of summit agreement.
According to the joint declaration, Deputy Prime Minister-level government officials from the two sides will head the committee. Currently, vice-minister level officials lead the discussion of inter-Korean economic issues.
``The two Koreas have begun treating economic cooperation issues on an equal footing to political and military matters, which I think is a positive development for increasing economic ties," Lee said. "Among others, it is significant that the two sides agreed to regularly operate inter-Korean railways by ensuring security of South Korean train passengers and resolving other military-related obstacles."
South Korea has only been able to test two inter-Korean railways linking the Gaesong Industrial Complex and Mt. Geumgang from the South as the North has been reluctant to allow the full operation of the railways on military concerns.
According to the joint declaration, the two sides also agreed to create a special peace zone around Haeju in North Korea and nearby areas, as well as work towards a joint fishing area, peace waters, special economic zone and joint development of the estuary of the Han River. The Koreas also plan to construct joint shipbuilding complex in Nampo, near Pyongyang.
``Among singed economic cooperation projects, the maintenance and repair of train tracks and highways in the North is the only one that requires the South provide cash to the North. I think economic cooperation agreements this time is comprehensive and more two-way street than the one-way street, compared to the ones agreed back in 2000,'' Lee said.