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A Brief Review of Inter-Korean Relations (April 28,2006)

Facts about Korea

A Brief Review of Inter-Korean Relations (April 28,2006)

1. Historic Background

When the Second World War ended with Japan's defeat, all Koreans aspired for a unified independent nation but instead suffered national division resulting from the subsequent Cold-War confrontation between the East and the West. The national division and establishment of separate governments in the South and the North eventually led to a civil war, the Korean War (1950-1953). The Korean War was a by-product of internal ideological conflicts and was viewed by many as a proxy war between the West and the Communist bloc.

The Korean War developed into a large-scale international war involving 16 Western countries as well as China and the USSR from the Communist bloc. The fighting ended in an Armistice, which created a 155-mile truce line dividing the Korean Peninsula.

After the ceasefire, the Cold War confrontation on the Korean Peninsula intensified. The South Korean Government pursued a policy toward North Korea aimed at achieving unification by defeating Communism. At the same time, North Korea declared a strategy of a “revolutionary stronghold” and attempted to communize the South, as well.

From the beginning of the 1970s, Cold War tensions began to ease, with capitalist and communist countries seeking détente. Against this backdrop, Seoul and Pyongyang simultaneously announced the South-North Joint Communiqué of July 4, 1972 and initiated dialogue and exchanges on a limited scale, including the South-North Red Cross Talks and South-North Coordinating Committee Meetings. Nevertheless, it proved to be impossible to relieve the animosity and mistrust between the South and North or build mutual confidence in the political arena.

In 1979, the USSR invaded Afghanistan, which drove the world back to a new Cold War confrontation and turned inter-Korean relations sour. By the mid 1980s, reforms and openness in the USSR triggered an acceleration of reforms and opening in East European Communist countries. As the Cold War began to be dismantled, inter-Korean relations reached an important turning point.

On July 7, 1988, in response to the easing of the Cold War internationally, the South Korean Government announced the Special Declaration in the Interest of National Self-Esteem, Unification and Prosperity. By 1990, inter-Korean relations had improved dramatically with the beginning of South-North High-Level Talks between the prime ministers.

At the fifth round of the High-Level Talks in 1991, the two prime ministers signed the Agreement on Reconciliation, Nonaggression and Exchanges and Cooperation between the South and the North, also known as the Basic Agreement. It marked one step forward toward peace and unification on the Korean Peninsula.

Due to serious economic difficulties in North Korea, however, outsiders expected the regime to collapse. Furthermore, suspicions were raised about whether North Korea had developed nuclear weapons when it withdrew from the Nuclear Nonproliferation Treaty in March 1993. Due to these developments, tension on the Korean Peninsula heightened in the mid-1990s.

The issue of a North Korean nuclear program caused inter-Korean relations to be nearly severed, and they only began to gradually improve as the Kim Dae-jung Administration (1998-2003) carried out a policy of reconciliation and cooperation, dubbed the Sunshine Policy. These efforts culminated in the first inter-Korean summit, which was held in Pyongyang in June 2000 and resulted in the June 15 South-North Joint Declaration.

The inter-Korean summit served as a watershed in inter-Korean relations, turning the five-decade long relations of confrontation and hostility into ties of reconciliation and cooperation.

Since June 2000, much progress has been made in inter-Korean relations. Dialogue has opened in various areas and exchanges of members of separated families have been activated. In addition, there has been an increase in inter-Korean exchanges of personnel and goods.

The outbreak of the second North Korean nuclear crisis in October 2002 disrupted this reconciliatory mood and raised tensions again on the Korean Peninsula.

2. Consistent Pursuit of the Policy of Peace and Prosperity

Since its inauguration in 2003, the Roh Moo-hyun Administration, dubbed the Participatory Government, has consistently pursued the Policy of Peace and Prosperity, which built on the Sunshine Policy of Reconciliation and Cooperation of the Kim Dae-jung Administration. The Policy is based on a recognition that a peace framework is needed not only on the Korean Peninsula but also in the entire Northeast Asian region. The main thrust of the policy is to achieve peace and prosperity throughout the region while the South and the North exert efforts to find a peaceful resolution of the North Korean nuclear issue.

Under the policy, the South Korean Government has implemented several measures to deepen and develop substantial inter-Korean exchanges and cooperation in political, economic, military, social and cultural fields. Those measures have facilitated changes in North Korea and secured a basis for peace to take root on the Korean Peninsula and for the two Koreas to work together for coprosperity.

In 2005, the third year of the Policy for Peace and Prosperity, there were tangible results in inter-Korean relations. In that year alone, a total of 88,341 South and North Koreans traveled to each others' regions, which surpassed the number of 85,400 inter-Korean visits made up to the previous year. This increase is meaningful because it paves the way for the South and the North to form a single community of reconciliation and cooperation by relieving a sense of hostility through enhanced understanding.


In addition, the South and the North implemented concrete measures to ease military tensions on the Korean Peninsula. Both Koreas ceased propaganda activities and removed propaganda equipment in the Demilitarized Zone, and installed a hot line between the military authorities.

3. Efforts Toward Peaceful Resolution of the North Korean Nuclear Issue Through Progress in Inter-Korean Relations

Since its inauguration, the Roh Moo-hyun Administration has continued to search for a resolution of the North Korean nuclear issue under three principles: intolerance for a nuclear North Korea, peaceful resolution through dialogue and South Korea's active role in the resolution process.

The South Korean Government designated making a breakthrough in the North Korean nuclear issue through the Six-Party Talks as the core task of its security policy. It has consistently pursued advancements in inter-Korean relations to ensure that they would serve as a catalyst for the resolution of the nuclear issue.

After North Korea claimed on February 10, 2005 that it had nuclear weapons and indefinitely postponed participation in the Six-party talks, the South Korean Government prepared “an important proposal” to break the North Korean nuclear deadlock in a proactive manner at the earliest possible date. The core of the important proposal was to supply electricity to North Korea in return for North Korea's scrapping of its nuclear weapons.

Presidential envoy and then Unification Minister Chung Dong-young held talks with Chairman of the National Defense Commission Kim Jong-il on July 17, 2005 and explained to him the proposal. Based on the results of talks, the two Koreas agreed at the 15th Inter-Korean Ministerial Talks on June 24, 2005 on “the ultimate goal of denuclearizing the Korean Peninsula” and on finding a peaceful resolution of the nuclear issue through dialogue.

The 16th Inter-Korean Ministerial Talks coincided with the fourth round of the Six-Party Talks in Beijing in September 2005. The South Korean Government endeavored to deliver its message clearly to the North and induce a favorable response.

Thanks to these efforts to resolve the North Korean nuclear issue through dialogue, the fourth round of the Six-Party Talks adopted a six-point Joint Statement on September 19. It dealt with the abandoning of nuclear weapons by North Korea and implementing principles. The Joint Statement was followed by the adoption of a Chairman's Statement at the fifth round of the Six-Party Talks in November 2005. It reaffirmed the commitment of the participating countries to the implementation of the September 19 Joint Statement.

In the future, the South Korean Government will work to implement the Joint Statement and continue to exert efforts to ensure that progress in inter-Korean relations will have a positive influence on the attempt to find a resolution to the North Korean nuclear issue.

4. Deepening Inter-Korean Economic Exchanges and Cooperation

Following national division, the two halves of the peninsula became increasingly heterogeneous. Consequently, the South Korean Government has striven to rebuild a national community through inter-Korean exchanges and cooperation rather than rush to achieve unification.

Inter-Korean exchanges and cooperation have centered on three economic projects: reconnection of inter-Korean railways and roads, construction of the Gaeseong Industrial Complex and Mt. Geumgang (Diamond Mountain) tourism. The scope of these projects has expanded during the Roh Moo-hyun Administration.

In 2005, inter-Korean exchanges of people reached 88,341 and inter-Korean trade was valued at US$1.055 billion. More than 1,000 South Koreans visit North Korea every day across the Demilitarized Zone by newly opened overland routes. These exchanges and trade have continued to increase in 2006.

The South Korean Government has endeavored to set up measures to activate and guarantee inter-Korean exchanges of personnel and goods. These include easing transit and customs procedures and an agreement on guaranteeing safe passage between the two Koreas. Finally, the construction of transit facilities on the Gyeongui (Seoul-Shinuiju) and Donghae (East Coast) Rail Lines was completed on March 15, 2006 so that they can accommodate a maximum of 12,000 persons daily.

The Office of Inter-Korean Economic Cooperation was opened in Gaeseong. Staffed by South Korean civil servants residing in North Korea, the office consults directly with the North Koreans on inter-Korean economic cooperation.

There have been as many as 34 inter-Korean talks at which various issues have been discussed and solved. Inter-Korean talks contributed to solidifying the foundation for inter-Korean exchanges and cooperation on the basis of mutual understanding and trust.

Inter-Korean exchanges and cooperation is one of the pillars buttressing the Policy for Peace and Prosperity and bringing economic benefits to both Koreas. In addition, they will help remove mistrust between the two Koreas, which has lasted for a half-century by easing military tension on the peninsula and will play an important role in restoring the homogeneity of the Korean people.

5. Progress in the Gaeseong Industrial Complex

When completed, the Gaeseong Industrial Complex will be a large industrial complex housing factories from South Korea as well as other countries. It is being constructed on 16,340 acres in three stages; the complex itself is being built on 6,540 acres in the city and support facilities in an adjacent city on 9,800 acres.

In 2004, the pilot factory site was opened with 15 businesses. In 2005, the leasing of lots was completed for 41 acres in the first stage of development; the construction of infrastructure and buildings on the site is underway.

The South is cooperating with the North in working out institutional measures such as labor regulations for the development of the Gaeseong Industrial Complex and in expanding the infrastructure for the operation of factories. The South has provided 15,000 kilowatts of electricity to the pilot factory site since March 16, 2005, and, on December 28, 2005, it installed 228 direct telephone lines between the two Koreas after obtaining a re-export license for the U.S. communications equipment used there in compliance with U.S. Export Administration Regulations.

The Gaeseong Industrial Complex project brings benefits to both Koreas by combining the capital and technology of the South and the land and labor force of the North. It also promotes reconciliation and understanding because 6,000 South and North Koreans are working side by side.

As it is located between Seoul and Pyongyang, Gaeseong was one of the fiercest battlefields during the Korean War and remained heavily fortified even after the Armistice Agreement was signed. However, the Gaeseong Industrial Complex is turning the place once occupied by North Korean tanks and military units into a cradle of peace and coprosperity.

Learning from past failures in the Rajin-Songbong and Shinuiju Special Economic Zones, North Korea sees the Gaeseong Industrial Complex as a test case for opening and has shown a very cooperative attitude. They have allowed foreigners to visit Gaeseong to enhance the international community's awareness and attract foreign investment into the complex.

The Gaeseong Industrial Complex will play an important role in building mutual confidence, a key component in creating conditions so that the North can steadily change.

The South will make continuous endeavors to make Gaeseong a successful model of tension reduction on the Korean Peninsula and inter-Korean exchanges and cooperation.

6. Future Policy Directions

Based on the accomplishments of the Policy for Peace and Prosperity, the South Korean Government will focus in the future on substantially reducing military threats on the Korean Peninsula.

To that end, the Government will create a virtuous cycle between military and non-military fields where the easing of military tension activates cooperation in non-military fields, which in turn brings about a further reduction in military tension.

In addition, the South Korean Government will do its utmost to lay a foundation for the formation of a South-North community through the “institutionalization of peace,” which means taking institutional measures to remove the dangers of war on the Korean Peninsula and bring about a permanent peace rather than being absorbed in abstract discussions about unification.