South Korea cautiously braces for inter-Korean economic cooperation

  • Though the Panmunjeom Declaration signed between the two Koreas on 27 Apr 18 minimized economic cooperation, it still left ample room for the possibility of future cooperation between the two nations in resource development, infrastructure investment and the resumption of the Kaesong Industrial Complex.
  • Panmunjeom Declaration alludes to cooperation in mineral resources located in North Korea discussed in the previous declaration on 4 Oct 07. South Korea, the world’s fifth largest mineral consumer, relies heavily on imports, while North Korea has 42 kinds of minerals, whose potential value is estimated at KRW3,000tr.
  • North Korea has a reserve of rare earth, necessary for production of digital devices, including smartphones and computers, which Korean firms lead in the global market.
  • Kaesong Industrial Complex was also put back into focus, two years after it was suspended by Seoul in retaliation for the North’s nuclear test and missile launch.
  • In the Panmunjeom Declaration, the two sides also agreed to work together to connect and modernize their border railways. The plan includes taking practical steps to utilize the Gyeongui railway, linking Shinuiju, a city on the Korean Peninsula’s border with China, and Seoul.

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