South Korea and the Democratic People's Republic of Korea (DPRK) agreed to fully reopen the Kaesong industrial complex next Monday after agreeing on several institutional tools to help prevent future shutdowns and develop the factory park in a progressive manner, Seoul's Unification Ministry said Wednesday.

Kaesong industrial complex. (Source: Internet)

After marathon talks that lasted for around 20 hours from Tuesday morning, Seoul and Pyongyang announced a joint statement on when to reopen it and how to manage it.

The statement came from the second meeting of the joint management committee for the Kaesong industrial zone. The committee held its first meeting and separate subcommittee meetings last week.

"Institutional tools were actually provided through this second meeting to stably develop the Kaesong complex into an internationally competitive one," the Ministry of Unification said in a statement.

The ministry said the agreement will contribute to trust- building and sustainable progress in inter-Korean relations, noting that the Kaesong industrial zone's constructive development got back into its stride.

Under the agreement, the two sides will reopen the joint factory park in the DPRK's border town of Kaesong on Sept. 16 after conducting a trail run. The factory park, which has been suspended for more than five months, will be normalized right before the three-day Chuseok holiday that falls on Sept. 19 this year.

The two sides agreed on how to set up and run the standing secretariat of the joint management committee for the Kaesong industrial zone. The joint committee, which will be in charge of running the factory park, will give Seoul an equal say on the zone, which had been managed solely by Pyongyang in the past.

The secretariat, which will provide administrative support to the joint committee and four subcommittees, starts to be operated within this month.

The two sides also agreed to form a joint arbitration committee that will settle business disputes within the Kaesong industrial zone. The committee, which will be composed of one chairman and four members each from Seoul and Pyongyang, would be set up within three months.

The subcommittee in charge of passage, communications and customs agreed to adopt an electronic system to control passage to and from Kaesong of South Korean personnel through the radio frequency identification (RFID) technology. It also agreed to continue to discuss details on the introduction of mobile phones and the Internet in the factory park.

Another subcommittee in charge of international competitiveness will hold a briefing session for foreign investors in October to encourage foreigners to invest in the complex. Foreign companies who already invested in Seoul will be subject to the presentation.

To compensate for losses of South Korean companies running factories in Kaesong, corporate taxes for 2013 will be exempted. Payments of 2012 taxes will be delayed by the end of this year. The South Korean firms reportedly suffered losses worth around 1 trillion won (922 million U.S. dollars) due to the shutdown of the factory park.

The two sides agreed to hold the third meeting of the joint committee next Monday and another subcommittee meeting this Friday.

Source: Xinhuanet