Several local governments in South Korea provided subsidies to private organizations pursuing inter-Korean cooperation projects without thorough review. This is the latest example of leftist politicians trying to help North Korea through so-called humanitarian means. Taxpayers are not aware of what the private entities in charge of such projects are doing with the government funds.
According to the DongA Ilbo newspaper on September 29, 10 local city and provincial governments in South Korea carried out 15 inter-Korean cooperation projects since 2017. All 10 local governments were headed by the ruling Democratic Party (DP), except for the Seoul City Government, where conservative Mayor Oh Se-hoon took the government back in the April by-election this year.
The local governments paid 8.25 billion won ($6.96 million) in total to private organizations selected to run the projects. It was revealed that 8 local governments, excluding the Busan City Government and the South Gyeongsang Provincial Government, provided subsidies to private organizations without conducting public bidding and a thorough reviewing process. The 8 local governments paid 7.05 billion won ($5.95 million) to private entities in charge of 13 inter-Korean cooperation projects since 2017.
This is a clear violation of the Local Finance Act, which mandates local governments conduct a fair bidding process to provide funding to private organizations. It also states that, “No local subsidy shall be provided as operating expenses except in cases where explicit grounds are provided for in statutes or regulations.” It was revealed that those private organizations received funding without proving their “grounds.”
According to the media report, 12 of the 13 projects that lacked due process were conducted after 2018, which was when the South Korean government went all-in to improve relations with North Korea. An official from the Board of Audit and Inspection told the DongA Ilbo that, “It is a violation of the Local Finance Act if they provided subsidies without the public bidding process while conducting inter-Korean cooperation projects.”
There were many private organizations that had suspicious past records. Among the 13 beneficiaries, there were several companies that were established right before they applied for the funding. There also were companies that asked for funding for projects that were already completed. The DongA Ilbo reported that “this clearly shows that local governments used taxpayer’s money without any kind of verification.”
Rep. Seo Beom-soo from the main opposition People Power Party (PPP) acquired data from the local governments that showed their funding of the inter-Korean projects. In South Chungcheong, they selected a private company in May 2019 to provide onions to North Korea. The South Chungcheong government paid the company 460 million won ($388,185) to provide 360 kilograms of onions to North Korea.
However, the beneficiary of the fund was established in May 2019, the same month it was selected for the project. The chairman of the company worked as a member of an education-related committee at the Ministry of Unification.
The Gyeonggi government paid more than 2 billion won ($1.68 million) for four projects, including one to provide medical supplies to treat tuberculosis. The Seoul government paid 1.73 billion won ($1.46 million) to provide flour, soybean oil, and other agricultural products. All these projects were selected without the public bidding process and reviewing process.
“The Gyeonggi government is rejecting our request to provide detailed information, and for South Chungcheong, we are not even able to check whether the price was reasonable and the products were delivered correctly,” said Rep. Seo.
Despite North Korea’s continuous military provocations, the South Korean Ministry of Unification continues to work on how to provide “humanitarian aid” to North Korea. Last week, the ministry passed a proposal that would provide 10 billion won ($8.44 million) to private companies that conduct inter-Korean cooperation projects. It aims to provide up to 500 million won ($421,940) per company.
“As the closure of the North Korean border continues due to COVID-19, it was reported that their food and medical supplies are facing a shortage,” said Lee In-young, Minister of Unification last week. “We expect to provide 10 billion won worth of funding so that our warm regards can be delivered to the North Korean people. We hope their lives become safer and our relationship with North Korea improves.”
Despite the Moon Jae-in administration desperately trying to find a way to help North Korea, a new survey showed that people are not interested in aiding Pyongyang if they continue to pose a threat to the South.
According to Gallup Korea on September 27, 60.9 percent of survey respondents said all aid provided to North Korea should be stopped if Pyongyang does not abandon its nuclear weapons, while 34.6 percent said humanitarian aid is still necessary.
The survey showed that younger people are more straightforward about this issue. 71.6 percent of people in their 20s and 69.5 percent of people in their 30s said humanitarian aid should be blocked unless North Korea gives up its nuclear weapons.
The fact that much of this humanitarian aid appears to have been funneled to shady companies will likely only boost support for the tough stance shown by South Koreans.
