South and North Korea have met to discuss the connection and modernization of cross-border railways, which comprise the basic frame of South Korean President Moon Jae-in’s inter-Korean business initiative called the “new economic map of the Korean Peninsula.” Delegations from Seoul and Pyongyang held a railway cooperation subcommittee meeting at the Peace House on the South Korean side of the truce village of Panmunjeom on Tuesday, June 26. The railway talks are considered an important test of inter-Korean economic cooperation after the April 27 inter-Korean summit. Here is Oh Gyeong-seop, researcher at the Korea Institute for National Unification, to explain.

It’s the first time in ten years that South and North Korea have met to discuss railway cooperation. The two sides previously promised to hold railway talks by the end of June to follow up on the April 27 Panmunjeom Declaration. In the declaration, South Korean President Moon Jae-in and North Korean leader Kim Jong-un agreed that the two Koreas would take practical measures to connect and modernize cross-border railways and roads. At Tuesday’s talks, the South Korean delegation was headed by Vice Transport Minister Kim Jeong-ryeol, while the North Korean side was led by Vice Railroad Minister Kim Yun-hyok. They discussed connection and modernization of inter-Korean railroads and adopted a joint press release.

The two rail lines they are hoping to work on are the Gyeongui Line and the Donghae Line along the western and eastern part of the Korean Peninsula, respectively. Mr. Oh explains what the two sides agreed upon at Tuesday’s meeting after ten hours of discussions.

In the joint press release, the South and the North agreed to carry out a joint study on modernizing the Gyeongui and Donghae railways. The joint study will start first on July 24 on the northern section of the Gyeongui Line from Gaeseong to the northwestern border town of Sinuiju. Another feasibility study will be conducted on the northern section of the Donghae Line between Mt. Geumgang and the Tumen River. The two sides also agreed to arrange practical measures, including on the design and construction, for the modernization of North Korean railroads before holding a groundbreaking ceremony.

Under the agreement, the two sides will also jointly inspect the cross-border sections between Munsan in South Korea and Gaeseong in North Korea and between Jejin in the South and Mt. Geumgang in the North in the middle of July, although a specific date has not been set. Based on the result of the joint study and inspections, South and North Korea will push for follow-up measures, including construction around the train stations and the installation of signaling and communication systems. Analysts are saying that the recent railway talks set the basic frame of the “new economic map of the Korean Peninsula.” Mr. Oh continues to explain.

If the inter-Korean railways and roads are connected, it is highly likely that the Moon Jae-in government will push for its “new economic map of the Korean Peninsula” in earnest. In one of the major changes under this policy goal, South Korea seeks to build a traffic network linking Busan with Russia via North Korea’s Wonsan and Rason along the east coast of the Korean Peninsula. The new map envisions another transportation, logistics and industrial belt stretching from South Korea’s southwestern Jeolla provinces and the capital area to North Korea’s Gaeseong, Sinuiju and all the way to China. The connection of inter-Korean railways will raise the possibility of actually implementing these ambitious projects.

The new economic map initiative seeks to develop the “H-line economic belt” involving western and eastern sections on the Korean Peninsula as well as the inter-Korean border area, and to link that belt with the Northeast Asian economy. It is believed that South and North Korea drew a blueprint for the envisioned traffic infrastructure at their recent railway talks. Mr. Oh talks about potential changes from railway connections.

The connection of the western and eastern railways will enable people and materials to travel to Europe by train. A significant change is anticipated for logistics, in particular. At present, it takes 30 days to move from Busan to Moscow by ship. But it will only take 14 days to travel the same distance by train. It takes about two months for Busan to receive imported goods from Germany now. But 35 days would be enough in an era of both railways and ships in use. Also, it costs about 800 US dollars to transport one container by ship from Incheon to North Korea’s Nampo, but the cost will be reduced by 75 percent to 200 dollars when the Gyeongui rail line is used. The connection of inter-Korean railroads is expected to bring about a revolutionary change in transportation and logistics.

The recent inter-Korean railway talks are the first result in the economic area among follow-up steps to the Panmunjeom Declaration. Riding the positive momentum, Seoul and Pyongyang will also hold the forest cooperation subcommittee on July 4. Taking a step further, they may possibly expand their economic cooperation into agriculture, healthcare and environment, as agreed upon at the 2007 inter-Korean summit. But it will likely take a considerable amount of time before actually breaking ground for the railway project. Mr. Oh explains why.

Railway connections will hit their stride only after the U.N. lifts its sanctions on North Korea. On the assumption that the sanctions are lifted, South Korea’s Vice Transport Minister Kim Jeong-ryeol said that it would be possible to open the Donghae rail line within four years at the earliest or it could take up to six to seven years, if construction of the Gangneung-Jejin section is complete and some other situations are resolved. But it is hard to say that the connection itself will guarantee the actual operation of the railway. Even after the railway is connected, it will be necessary to examine how to ensure safety. Even the power grid and the signaling system are different on both sides, so they should also work on this part. Considering all these factors, it is estimated to take between four years and six or seven years to complete the connection of the cross-border railway.

The key to inter-Korean economic cooperation is whether sanctions on North Korea will be lifted. The lifting requires approval from the U.N. Security Council and the U.S. Congress. Therefore, South Korea should refrain from pushing for economic projects with North Korea hastily but carefully check the conditions of North Korean railways first. If Seoul and Pyongyang implements the Panmunjeom Declaration faithfully based on their shared views at the recent railway talks, they will get closer to realizing the dream of connecting the cross-border railways.