Hyundai hit by Kim’s remarks on Geumgang
Hyundai Group is in a panic about its business involving tourism to Mount Geumgang after North Korean leader Kim Jong-un ordered the removal of facilities built by the South at the North’s scenic mountain, according to group officials Wednesday.
According to the North’s Korean Central News Agency (KCNA), Kim made a “field guidance” visit to the mountain resort, during which time he ordered the removal of “all the unpleasant-looking facilities” built by the South and the construction of the North’s own “modern service facilities.”
Hyundai Asan CEO Bae Kookhwan and other executives held an emergency meeting in the morning to grasp the present situation and come up with countermeasures. “We were embarrassed by the news as we have been preparing for the resumption of the tour program,” a Hyundai Asan official said.
“We will respond calmly to the issue.”
Hyundai Asan, the group’s unit in charge of its businesses in the North, invested hundreds of billions of won in building facilities at Mount Geumgang and operating the tour program, which started in 1998 to bring South Koreans to the North’s scenic mountain.
But the company has suffered considerable operating losses as the tour program was halted in 2008 after a South Korean tourist was shot and killed by a North Korean guard.
Hyundai Group as well as other firms doing businesses in North Korea have had high hopes for the improvement of inter-Korean economic cooperation amid the Moon Jae-in administration’s peace drive.
Hyundai Group Chairwoman Hyun Jeong-eun has already visited the North three times this year, stressing the group members must fulfill their “responsibilities in contributing to inter-Korean cooperation and coexistence.”
But the latest news from the North, which came after the breakdown of working-level talks recently between the United States and North Korea, appears to be igniting pessimism about the future of inter-Korean economic cooperation.
“The news from the North today was obviously not good for Hyundai Group, which has already suffered from the suspended tour program for more than a decade,” an official from one of the conglomerates said. “But it would be premature to be too pessimistic as the group has already undergone a number of difficulties while operating inter-Korean businesses.”
Another official from a large Seoul-based company said, “Hyundai Group, together with the government, will need to check the North’s intentions and work to narrow the gap between the two Koreas.”
Regarding the issue, a Hyundai Group official said, “We will consult with related government offices including the unification ministry.”