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Hyundai Asan's operations in North Korea are deteriorating. Not only has its Kumgang Mountains tourism project been cut in half, potentially lucrative tourism projects to Kaesong and Mt. Baekdu might never see the light of day. Dialogue between the company and North Korea has been virtually severed after Hyundai decided to oust a senior executive who had for many years been its point man in talks with Pyongyang.
North Korea is reportedly taking out its irritation on South Korean visitors in the Kumgang Mountains. "Tourists who were a little noisy as they were touring the mountains were forced by the guides to write a confession,¡± says one who recently returned. ¡°Isn't that too much?"
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Hyundai Group chairwoman Hyun Jeong-eun (right) and Hyundai Asan vice chairman Kim Yoon-kyu (left), who had led the group¡¯s business projects in North Korea.
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The trigger was the dismissal of Hyundai Asan vice chairman Kim Yoon-kyu over charges of corruption. North Korea is persistently bringing up the matter to pressure Hyundai Asan, as the company has acknowledged. The company was given what was, in effect, a final ultimatum. During talks on Saturday in preparation for a third test run of the Kaesong tourism project, Pyongyang told a high-ranking Hyundai official that unless the "Kim Yoon-kyu issue" was resolved before the test run on Wednesday, it would have a serious effect on not just the Kaesong project but also the Mt. Baekdu and Kumgang projects. The North reportedly threatened to award the Kaesong project to another company.
The disappearance of dialogue channels is making Hyundai very nervous. North Korea is deaf to pleas from the company, which has in vain asked for a high-level meeting. Pyongyang merely repeats its demand to reinstate Kim. "We are working for dialogue from various angles to clear up any misunderstanding the North may have, but to no avail," a Hyundai executive said.
Forecasts are not bright because Hyundai has few cards left to play. Kim was dismissed after he was caught with his fingers in the till by an in-house probe, and his dismissal was led by the group¡¯s chairwoman Hyun Jeong-eun, who cannot now back down.
The only solution would be for Kim himself to try to make the North understand, but this may be too much to hope for. Kim returned to Korea on Aug. 29 from Qingdao, China but made straight for the U.S. and is not taking calls from Hyundai Asan. The Hyundai Group also says the decision of the company's board to oust him would be difficult to withdraw.
Some fear that North Korea could break out Plan B in its effort to pressure Hyundai and put the schedule for the Mt. Baekdu and Kaeseong programs on indefinite hold. "Frankly, we have no way to respond because we don't know North Korea's real intention,¡± a Hyundai executive said. ¡°For now, all we can do is wait."
(englishnews@chosun.com )
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