Hyundai's visit to North Korea raises hopes for economic cooperation but obstacles remain

Hyundai has been rebooting its inter-Korean business team after a summit between South Korean President Moon Jae-in and North Korean leader Kim Jong Un in April, 2018.
Hyundai has been rebooting its inter-Korean business team after a summit between South Korean President Moon Jae-in and North Korean leader Kim Jong Un in April, 2018.PHOTO: REUTERS

SEOUL (THE KOREA HERALD/ASIA NEWS NETWORK, AFP) - A group of 15 officials from Hyundai, including Chairwoman Hyun Jeong-eun, will be travelling to North Korea on Friday (Aug 3) for a memorial service to mark the death anniversary of her late husband and former group chairman Chung Mong-hun.

Lee Young-ha, CEO of the group's inter-Korean business arm Hyundai Asan, will be among the officials.

All eyes are on whether the visit will contribute to the revival of inter-Korean economic cooperation amid the US' determination to keep sanctions intact until the North's complete denuclearisation.

The South Korean government reiterated its stance on Friday that resuming the operation of an inter-Korean industrial complex should be considered in light of progress in denuclearisation talks and any decision will have to wait until sanctions are lifted, reported Yonhap news agency.

"The government's stance remains unchanged when it comes to the issue of the resumption of the Kaesong Industrial Complex," Lee Eugene, a deputy spokesperson of the unification ministry, told reporters during a regular press briefing.

A memorial service for Chung had been held regularly since his passing in 2003, but was halted over rising border tension in 2016 and 2017.

Industry insiders are expecting discussions related to inter-Korean businesses to take place at Friday's memorial service as North Korean officials have often participated in the service in the past.

The trip will be the first visit to the country by Hyun since 2014. The Hyundai chairwoman met late North Korean leader Kim Jong Il several times and was the among the first South Koreans to meet his son and current leader Kim Jong Un after he assumed power.

The group's founder, Chung Ju-yung, championed closer ties with Pyongyang, pioneering many inter- Korea business projects including the now-closed jointly-run Kaesong industrial complex in the North.

Hyundai also poured hundreds of millions of dollars into a tourist resort at Mount Kumgang, just north of the tense border, and operated tours for South Korean visitors in an effort to promote inter- Korea ties.

Resumption of the cross-border tour programme to a resort in Mount Kumkang - which was launched in 1998, but suspended following the fatal shooting of a female tourist by a North Korean guard in 2008 - is likely to be a key topic if discussions take place.

Hyundai has been rebooting its inter-Korean business team after a summit between South Korean President Moon Jae-in and North Korean leader Kim Jong Un in April.

The conglomerate has launched a special task force led by Hyun herself, for the inter-Korean business sector in May. The Panmunjom Agreement reached between the two leaders at their April summit promotes cross-border economic cooperation.

Both leaders also agreed to hold a third summit this fall.

 
 

Despite high hopes surrounding the visit, experts say that the resumption of such inter-Korean businesses depends on the progress in denuclearisation talks between the US and North Korea, coupled with international sanctions against the reclusive nation.

"When the third inter-Korean summit takes place, more 'solid gifts' would have to be exchanged between the two Koreas - President Moon would have to prepare resumption of the Kaesong industrial park and tours to Kumgangsan, while Kim would have to show more proof regarding its denuclearisation," said Yang Moo-jin, a professor at the University of North Korean Studies.

"But it would mean nothing without progress in US-North Korea talks."

Meanwhile, Seoul is consulting with the United Nations to get sanctions temporarily exempted for the operation of an inter-Korean liaison office in the North, a Unification Ministry official told reporters on customary condition of anonymity.

South Korea earlier requested the UN to consider exemptions from sanctions for the liaison office in the North's border town of Kaesong set to open within this month.

The waiver request is intended to address possible problems that could arise in operating the office, such as fuel supply to generate electricity for the facility.

South Korea has secured a waiver on sanctions related to preparations for the family reunion event to be held from Aug 20 to 26 at the Mount Kumgang resort