[imText1]Does North Korea really believe that return of the ex-co president of Hyundai Asan, Kim Yoon Kyu wouldreturn to the economic cooperation with North Korea? It is highly doubtful that North Korea does.
Then why does North Korea making such a big deal out of the problem of Kim Yoon Kyu and says it needs to reevaluate the entire business with Hyundai?
On the superficial level, North Korea says it is a matter of trust but it is pathetic for North Korea to even mention trust when it has broken so many promises. In the end, it is nothing more than a mere excuse to further its relations with Hyundai. It needed an excuse, and now it is provided.
Its drawing a line in between itself and Hyundai does not seem though it is trying to entirely cut off its relations with Hyundai. Its intention is to involve other actors for the economic cooperation in order to induce “fidelity competition.” North Korea tried Kaesung tour business with Lotte Tour and sent a proposal to Korea Tourism Organization for Baekdo Mountain try-out tourism.
It has extracted as much as it could from Hyundai and if it wants more, there is a need for it to involve other partners to induce competition. North Korea is trying to manipulate the market economy principles.
The fault of Hyundai does not lie on the fact that Hyundai broke trust but that it remained optimistic trusting North Korea.
North Korea’s Signal that Hyundai Must Not Expect More
North Korea is using the method of diversifying channels on food aid as well.
Recently North Korea demanded to change WFP aid to development aid and those food distributor who had been demanding for monitoring to leave the country. It further demanded for humanitarian aid providing NGOs to leave in the country as well.
After that, there was a rare scene created where the WFP pleaded for its stay in North Korea. The WFP is well aware of the fact that North Korea’s food amount is far short the minimum required level. Using this kind of method, North Korea received a great amount of food aid so much easier than other countries, but still it threatens its aid providers.
On September 1, Marcus Norland, an American North Korean economy expert and a senior researcher in The Institute for International Economics and Stephan Haggard, professor at the University of California, San Diego produced a report titled, Hunger and Human Rights: The Politics of Famine in North Korea」 and suggested to unify method of providing food aid to North Korea through the WFP. This suggestion was made in order to not fall in the North Korean trap.
Let’s resume back to the problem of North Korea’s reevaluation of its business with Hyundai. North Korea is well aware of the fact that there is slim chance that Hyundai will abandon its business in North Korea. Due to the heavy investment it put in North Korea, unless there is an extreme case, there is nothing that will stop Hyundai’s business in North Korea. The matter does not lie in the hand of Hyun Jung Eun, CEO of Hyundai.
Therefore, the statement given out by the North’s Asia-Pacific Peace Committee suggested Hyundai that now it the right time to leave. For North Korea, although the Keumkang Mountain tourists were reduced to half, North Korea still benefits, but for Hyundai, there is a long way to go to make profit before it makes up the amount it invested. For Hyundai, there is a big loss.
All other businesses too will turn into a clear “treated well only so long as it is useful and dumped in vain after used.”
For Hyundai, it has no choice but to submit to the situation. The government of South Korea is no that friendly to Hyundai either. For the South Korea government, not matter which company it is whether Hyundai or not, holding on to momentum of talks with the North is more important. The South Korean minister of Unification, Jung Dong Young, said in the recent inspection of the administration “Just because North Korea made a contract of monopoly with North Korea, that does not mean the government policy is automatically obliged to it.”
One of the solutions is to not respond to North Korea’s “love call” to other enterprises. If it decides to become a economic partner with North Korea only for the immediate goal of making profit or tricked by government favoritism, it is only a matter of time that it will be treated well only so long as it is useful and dumped in vain after used just as Hyundai.
Another solution could be Hyundai to take strong position. Although its loss would be significant, it may be useful to take a hard line and withdraw the entire Keumkang Mountain tour business for a while. Although North Korea must have already thought that Hyundai could take such a move, because it would think such a move is of little possibility, it will regret its mistreatment of Hyundai after all. It will learn the lesson from loss. It requires a bold response with a harder line measure to face North Korea’s hard line measure. That is the way to win North Korea.
Furthermore, North Korea made an issue out of the relationship between Hyundai Group personnel and (South Korea) Grand National Party and rumors conspiracy as well as US-ROK alliance and speed control and took the argument as far as that it could be backed up by the US. Such propagandistic statements are nothing new and still worthless. Probably the writers at the United Front Department included these lines to make it sound more persuasive.
