With just one month to go before North Korea is due to begin repaying food loans made to it between 2000 and 2007 by the governments of President Kim Dae Jung and Roh Moo Hyun, lawyer Han Myung Seob today suggested that, “Repayment of food loans should be linked to abductees, separated families and humanitarian issues and then negotiated with North Korea.”
Han, speaking at a seminar held by the Institute for Peace Affairs, said, “South Korea should pass the ball to North Korea by giving notice of the repayment date and reimbursement. After watching North Korea’s response we should use this situation positively.”
He continued, “North Korea’s will to repay the food loan back is the most important in this situation, but it is highly unlikely that North Korea will keenly pay it back. If North Korea remains in default on payment, South Korea will hold a card able to put pressure on the default.”
“If South Korea, on the verge of the repayment date, notifies North Korea of it and requests payment then they will be able to link family reunions, abduction problems and other humanitarian issues to it,” he went on.
Meanwhile, Cho Bong Hyun of IBK Institute of Economic Research said, “South Korea does not need to exempt, remit or extend the food loans. North Korea’s debt needs to be left so that South Korea can use it as a card to negotiate with in the future.”
Cho pointed out, “When a period of time has passed and if North Korea still has economic problems, they are likely to come back to economic cooperation. At that time South Korea can utilize the debt as a means to resume talks.”
From 2000 to 2007, the South Korean government extended loans of 2.4 million tons of rice and 200,000 tons of corn to North Korea. Even excluding interest, the value of the loans is approximately 8.2 billion won.