[THE INVESTOR] South Korea said on Sept.5 that it has provided 74 percent of earmarked support funds to local firms that operated factories at the now-shuttered joint industrial park in North Korea.

The government has offered 376.7 billion won (US$340.1 million) out of about 500 billion won in state funds to South Korean companies that have factories inside the Kaesong Industrial Complex, according to Seoul’s Unification Ministry.

Seoul shut down the factory zone in the North’s border city of Kaesong on Feb. 10 in response to Pyongyang’s January nuclear test and long-range rocket launch in the following month.

The decision came amid concerns that money generated from the factory zone is bankrolling the North‘s nuclear and missile programs.

The shutdown of the complex may have caused 1.5 trillion won in losses, according to local firms, adding that the government’s financial support measures are not sufficient.

The complex, which opened in 2004, had served as a major revenue source for the cash-strapped North.

A total of 124 South Korean companies operated in the zone, some 50 kilometers northwest of Seoul, employing more than 54,000 North Korean workers to produce labor-intensive goods, such as clothes and utensils.

(theinvestor@heraldcorp.com)