South Korea considers financing of possible inter-Korea projects

South Koreans walk by a banner showing a map of the Korean Peninsula at Seoul City Hall in Seoul, South Korea, on April 27, 2018.
South Koreans walk by a banner showing a map of the Korean Peninsula at Seoul City Hall in Seoul, South Korea, on April 27, 2018.PHOTO: EPA-EFE

SEJONG, SOUTH KOREA (REUTERS) - South Korea's finance minister said on Wednesday (May 2) the government was discussing how to finance possible economic projects with North Korea, although any projects with Pyongyang must first be approved by the international community.

"We're internally carrying out preparations, in terms of what to prepare, and how to cooperate with the international community, and how to finance (possible inter-Korea projects)," Kim Dong Yeon told reporters in Sejong.

"But we need support from the international community and need to watch the (upcoming) summit between the United States and North Korea," Kim said, without elaborating on specifics of any government financing.

Kim's comments come after South Korean President Moon Jae In and his North Korean counterpart Kim Jong Un agreed last Friday on a common goal of a "nuclear-free" peninsula, and to "adopt practical steps towards the connection and modernisation of the railways and roads".

Many speculate that the two Koreas will start joint infrastructure projects as soon as international sanctions on North Korea are lifted.

South Korea's newspaper JoongAng Ilbo reported that President Moon gave the North Korean leader a USB drive during last week’s summit.

According to a senior Blue House official who briefed local reporters on Monday, the USB contained an e-book and a short presentation illustrating Moon’s so-called “New Economic Map” initiative, which was initially made public last July in a speech in Berlin.

While visiting Germany for a summit with German Chancellor Angela Merkel and to attend a Group of 20 Summit, Moon gave a speech at the Koerber Foundation in Berlin describing a road map for Korean reunification.

At the time, Moon stressed that his vision was to be implemented after progress was seen in the nuclear crisis.

South Korea’s Unification Ministry, which handles relations with the North, says the initiative aims at a “single market” for the two Koreas in order to “lay the foundation for unification" job creation and higher economic growth for both countries, reported JoongAng Ilbo.

Currently, North Korea is under sanctions imposed by the United Nations Security Council to stop its nuclear weapons and missile programmes.

Kim also said there was a rise in the number of Chinese tourists in March although the service sector has not yet recovered from a drop in such visitors due to tensions between the two countries.

 
 
 

"The number of Chinese tourists is noticeably increasing since March, although it hasn't recovered to the pre-Thaad level," Kim said.

Tourist numbers plunged last year after South Korea angered China by deploying a US Terminal High Altitude Area Defence (Thaad) system that features radar which Beijing believes could be used to penetrate its territory.

Kim did not cite any numbers showing an increase in Chinese tourists in March.

The Bank of Korea estimated earlier that the Thaad backlash knocked 0.4 percentage points off South Korea's economic growth rate in 2017.