By Kim Se-jeong
Staff Reporter
Eighty-eight South Korean companies are expected to face financial trouble after North Korea decided to halve the number of southerners stationed in the Gaeseong Industrial Complex. Now the question is who is to shoulder the burden.
The companies have recently asked Seoul to compensate them for their expected losses.
According to an association of the firms, they have suffered 110 billion won in losses for the past three months due to cross-border political tension.
One official from the complex told the Yonhap News Agency that the government, which is alleged to have caused the problem, must give them compensation.
However, the government doesn't appear to be considering that option.
Seoul has not specified a method of providing any safety net to South Korean companies when their business is in trouble due to cross-border tension.
The South-North Economic Exchange created an insurance fund in case factories were closed for more than three months. Yet its coverage is limited ― 90 percent of the initial investment up to five billion won ― as only 69 companies purchased the policy.
However, critics insist that the individual firms must bear the financial burden, not the government.
The complex is one of the visible results of an engagement policy toward North Korea. Since the Lee Myung-bak administration was launched, Pyongyang has gradually scaled down inter-Korean exchange and contact, including closure of the Mt. Geumgang and Gaeseong city tours.