SEOUL, South Korea is expected to approve additional compensation for local firms that suffered losses due to the shutdown of the joint industrial complex in the North as early as next week, a government official said Thursday.

The government plans to offer 66 billion won (US$60.7 million) to 124 firms that operated factories at the Kaesong Industrial Complex in North Korea to help them cover losses from Seoul's 2016 decision to stop operations there.

Seoul has already provided 517.3 billion won to the companies after the previous conservative government closed the complex, once viewed as a symbol of inter-Korean economic cooperation, in response to North Korea's fourth nuclear test.

"The government is likely to hold a meeting for approval soon," the government official said. "Compensation is expected to be delivered to firms by December."

Seoul's unification ministry said on Nov. 10 that it will increase support for local firms shouldering huge losses from their investments in inter-Korean projects suspended due to political tensions.

"The measure is meant to fulfill the state responsibility for those companies that have suffered from unexpected business setbacks due to a shift in the government's policy decisions," the ministry said.

A group of local firms investing in the Kaesong park said that government compensation is insufficient to cover what it claims to be more than 1.5 trillion won in losses. The government put the estimated damage at 786.1 billion won.

Seoul said the resumption of the operation of the Kaesong complex will depend on progress over the resolution of North Korea's nuclear standoff.

The resumption of the Kaesong complex is a tricky issue as it could violate U.N. sanctions resolutions aimed at curbing inflows of hard currency to North Korea.

Former Unification Minister Lee Jong-seok raised the need for an early resumption of the factory zone at a forum Thursday.

"As the Kaesong complex is a precious asset to us, it should be restarted as soon as possible," Lee said. "The resumption hit a snag due to North Korea's nuclear issue, but we need to resume it after finding solutions (to the nuke standoff) to create more joint factory zones."

Source: Yonhap News Agency