January 29, 2015 11:31
Inter-Korean trade volume nearly doubled to US$2.3 billion in 2014, according to the Korea International Trade Association on Wednesday.
This is a big increase from 2013, when trade hit an eight-year low after Pyongyang closed the Kaesong Industrial Complex due to political tension. The complex accounts for almost all inter-Korean trade.
The recent jump could get an extra boost from the new free trade pact between Seoul and Beijing, as the two sides agreed to consider Kaesong products as being South Korean in origin.
Manufacturers who invest in the Kaesong complex will gain a competitive edge, as their labor costs will be lower than those in China.
But obstacles still remain between the two Koreas.
North Korea added a new rule in September that allows it to detain South Korean businessmen if they do not comply with a contract or fail to make agreed payments.
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