August 06, 2012 12:36
North Korea's Taepung International Investment Group, established in December 2009 to woo foreign investors, has been shut down due to poor performance, it emerged on Saturday. Experts believe the closure of the military-controlled firm is related to the ouster of North Korean Army chief Ri Yong-ho, who was apparently mired in corruption.
Taepung was tasked with implementing key economic development plans and became known to the outside world when the powerful National Defense Commission appointed it as the official conduit to lure foreign capital into the North's state development bank.
"When it was launched in 2010, Taepung aimed to attract US$10 billion that year alone and a total of $120 billion in five years," said one government official here. "I believe it failed to achieve tangible results."
A Korean-Chinese businessman, Pak Chol-su was first appointed to head the company but was later sacked, while the state development bank was also dismantled. Any mention of Taepung disappeared from the North Korean media at the end of last year.
After its closure, a separate foreign-investment body run by the Cabinet is expected to become more influential. The developments are believed to be part of North Korean leader Kim Jong-un's attempts to loosen the grip of the powerful military and give more power to party technocrats.
The Asahi Shimbun reported last Thursday that Kim ordered the military not to meddle in efforts to attract foreign capital, and also shut down an organization known as Room 39, which managed former North Korean leader Kim Jong-il's slush funds and directed businesses earning foreign currency through 17 overseas offices and 100 trade firms under its roof.
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