Hyundai Asan Faces Mounting Losses from Mt. Kumgang

      July 11, 2011 10:42

      Hyundai Asan is suffering snowballing losses after tours to Mt. Kumgang in North Korea were halted in the wake of fatal shooting of a South Korean tourist in the resort.

      Park Wang-ja was shot dead by a North Korean soldier on July 11, 2008 and Hyundai Asan's sales losses have accumulated to W390 billion over the three years, with staff dwindling from about 1,000 to just over 300, a spokesman said on Sunday (US$1=W1,058).

      Seoul set out three conditions for the resumption of the tours -- a joint investigation of the shooting, a pledge from the North that such incidents will not recur, and a safety guarantee for tourists. The North refused.

      In late April last year, right after the sinking of the Navy corvette Cheonan, the North also froze South Korean properties and assets in the resort, including Asan's facilities in the Oekumgang area. In April this year, it unilaterally canceled the exclusive contract with the Hyundai Group.

      Early this month, the North launched group tours for Chinese tourists to the reclusive country including the Kumgang area through Chinese travel agencies.

      It announced it will "dispose of" properties including real estate and a hotel in the mountain area owned by South Korean enterprises such as Hyundai Asan. Asan staffers were told to go there by this Wednesday and close up properties there.

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