SEOUL (AFP) — South Korea said Friday the communist North was committed to peace and promised that the private sector will largely pay for an estimated 11 billion dollars in new projects agreed at a landmark summit.
President Roh Moo-Hyun, only the second South Korean leader to visit Pyongyang, pledged with North Korean leader Kim Jong-Il to work for a peace treaty to close the last Cold War frontier after six decades of division.
The summit declaration also called for a series of joint economic projects including a special economic zone around the North's western port of Haeju, construction of joint shipyards and tours to the North's scenic Mount Paekdu.
The deals surprised South Korean analysts and media, who had low expectations of the summit, although Roh's conservative critics charged that he failed to press the North on its nuclear weapons and human rights record.
Unification Minister Lee Jae-Joung said the two countries had started "a new framework to bring about permanent peace on the Korean peninsula and advance their relations, including economic cooperation and exchanges."
"This summit has opened a new chapter for peace," Lee told a news conference.
The leaders' declaration called for a summit with the United States and China to permanently end the 1950-53 Korean War, which halted with only an armistice.
Foreign Minister Song Min-Soon pledged that work to draft a peace treaty would take place "in line with denuclearisation" -- not separately from it.
An upbeat Roh, a staunch advocate of reconciliation with the North, who leaves office in just four months, called a cabinet meeting and ordered his ministers to set up a "roadmap" to implement the summit's achievements.
Roh has said that Kim confirmed to him his "commitment to denuclearisation," almost exactly one year after his regime tested an atom bomb.
The leading Hyundai Research Institute estimated that the economic projects in the impoverished North would cost some 11 billion dollars.
But the government promised that the private sector would pick up most of the bill. Concerns over South Korea's economy are dominating the campaign for December presidential elections, for which the conservative opposition candidate was the clear front-runner before the summit.
"These will be commercial, civilian projects and government expenditure will not be so great as you may think," Finance and Economy Minister Kwon O-Kyu said.
He said the projects, by combining South Korea's capital and technology with the North's human resources, would bolster both economies and raise Seoul's credit ratings.
A South Korean state corporation has been raising a two-billion-dollar fund to invest in overseas ports and this fund alone will be enough to finance the Haeju economic zone project, he said.
He noted that the government-backed Korea Land Corporation had been retrieving its investment at the Kaesong industrial park, the signature South Korean project in the North, launched after a first inter-Korean summit in 2000.
Currently some 22 South Korean companies operate in a Seoul-funded industrial estate at Kaesong, employing more than 13,000 North Koreans who earn some 60 dollars a month.
The conservative opposition Grand National Party said the deals might burden taxpayers and took issue with an agreement to open part of the South's disputed sea border to North Korean ships.
"We will examine to see whether the agreement is a breach of the constitution and whether it imposes excessive tax burdens on the people," said An Sang-Soo, the party's parliamentary floor leader.
The joint declaration committed the two sides to pursue ongoing six-nation talks involving the United States on ending North Korea's nuclear programmes.
While the summit did not commit the North to any new steps, it marked the first time that supreme leader Kim had personally signed his name to denuclearisation efforts.
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