Mixed News on Kaesong
The bad news is that Kaesong-made goods look to be headed toward acceptance into the ASEAN FTA. This comes via Philip Dorsey Iglauer, who has made himself infamous both for awful reporting and awful analysis, so you’ve been warned.
I kind of hope Iglauer likes to google his own name, because that’s my cue to point out a story in the Donga Ilbo that’s certain to have him calling for his smelling salts:
The Korean government is opposing an article written by Jay Lefkowitz, the U.S. Special Envoy on Human Rights in North Korea, on April 30 that raises questions about the wages and human rights of North Korean workers in the Gaesong Industrial Complex.
. . . .Lefkowitz wrote the article for the April 28 edition of the Wall Street Journal and it referred to issues of labor extortion from North Korean workers in the Gaesong Industrial Complex. Regarding this, a South Korean government official protested against the article saying that it was intervention in the internal affairs to criticize the Gaesong Industrial Complex with such a biased and distorted point of view.
Umm, having standards as to what products we choose to import at favorable rates is an internal American affair, if anything. What we’re talking about, of course, is a negotiated agreement between two sovereign states. Either is free not to sign the agreement if the terms are not to its liking. It strikes me that Korea can’t simultaneously act like a victim and demand to be treated as a more equal and independent partner. It looks like more of that famously suave South Korean diplomacy, the kind that made a complete fool of Korea before a global audience, over two worthless, uninhabitable, barren pieces of guano-encrusted rock that Korea already occupies.
The Administration seems determined to make an issue of this, and much to its credit. Lefkowitz raised the Kaesong question again at the Capitol rally last Friday, but he didn’t mention the nickel-an-hour wage the workers there actually get after Kim Jong Il takes his cut. Remember that when South Korean politicians and corporate hacks tell you the workers at Kaesong make $58 an hour. It’s a lie. And yes, an above-average wage still qualifies as slave labor when you have absolutely no say in the conditions of your employment, and when the average wage is literally a starvation wage.
After having a discussion, Cheong Wa Dae and the Ministry of Unification judged that if nothing is done on this issue raised by U.S. Special Envoy Lefkowitz, their plan to attract foreign companies to build factories within the Gaesong Industrial Complex could go wrong. Accordingly, they have decided to take drastic steps.
That step was to eliminate the possibility that the Gaesong Industrial Complex could be added to the list of North Korean human rights issues which has become an international issue after Mr. Bush met the families of abductees from North Korea and North Korean defectors in person.
Remember, all you budding diplomats: there’s no way to win friends and influence people quite like a public tantrum, and be sure to throw in some ad hominem attacks against a guy with the President’s ear. This was pretty remarkable:
The Korean government seemed to be troubled by U.S. President Bush meeting with families of abductees from North Korea and North Korean defectors at the White House on April 28. South Korea-U.S. tensions surrounding human rights policy in the North are running high.
Got that? Tensions are not running high over the thousand South Korean citizens still held hostage in North Korea despite nearly ten years and billions of dollars in bribes and inducements, or over the ten thousand artillery tubes the North still has pointed at the South. Tensions are running high because the U.S. president has the temerity to support calls for the release of the innocent victims. To make the South Korean position even more obnoxious than the betrayal of its own soldiers and citizens, it also claims the right to silence America regarding the kidnapping of Japanese.
I leave you with this:
Michael Green, the Japan Chair at the Center for Strategic and International Studies (CSIS) recently revealed what key figures at the While House have in mind, saying the Bush administration is coming to the conclusion that North Korea has no intention of giving up its nuclear program.
It took these guys six years to figure this out?
Does anyone know if the $58 per month is converted in accordence with the official exchange rate? If so, they do not make $0.05 per hour, but rather NKW128 per month, about $0.04.
It is very misleading to use any kind of “official exchange rates”. The Asian Financial Crisis and subsequent exposure of the underworkings of the exchange rate system by Dr.Mahathir whould have enlighten you on the issue.
What is a better indicator is the practical bartering system. What do you have to give up in order to persuade a North Korean to give him his TV or his cigarettes? Then value the exchange rates based on that.
For example, if he is willing to give up his TV in exchange for 10 packs of Marlboro, then the exchange rate is about that, a North Korean TV for 10 packs of American cigarettes.
Until the market becomes efficient, it is pointless to use the “official” exchange rate because it can be valued at any price.