(News Focus) After `cordial` talk with N.K. leader, Hyundai chief has long way to go

By Kim Hyun
SEOUL, Aug. 17 (Yonhap) -- For the Hyundai Group chairwoman, her persistence
finally paid off. After extending her stay in North Korea several times, Hyun
Jung-eun was able to meet with North Korean leader Kim Jong-il on Sunday, a major
boost to her efforts to resume the conglomerate's stalled ventures in North
Korea.
But their "cordial" talk is unlikely to lead to any breakthrough as long as
Seoul's hardline policy and U.N. sanctions over North Korea are in place, experts
say.
Hyun traveled to North Korea on Monday for what was expected to be a three-day
mission to win the release of a detained worker, who was subsequently freed and
returned home Thursday. But her major ambition, Hyundai officials say, was
finding ways to resuscitate tourism ventures stalled since last year, pushing the
group into deep financial straits.
On her sixth day in North Korea, the reclusive leader finally sat down with Hyun
for a luncheon. Kim talked with her in "an atmosphere of compatriotic feelings,
remembering the predecessors of the Hyundai Group with deep emotion," the North's
Korean Central News Agency said.
"Chairman Kim met her, considering his long relationship with the Hyundai family.
In other words, he had nothing else to bring up in that meeting," Koh Yu-hwan, a
North Korea studies professor at Dongguk University, said.
The North Korean leader knows that Hyundai is desperate to revive the suspended
business ventures. And North Korea's frail economy, under U.N. financial
sanctions over the country's nuclear test in May, badly needs cash injections
from the inter-Korean projects. But their shared interest can do little to ease
U.N. financial sanctions and change Seoul's conservative stance, Koh said.
The South Korean government suspended Hyundai's major tour program to Mount
Kumgang in North Korea's east coast last year after a North Korean soldier shot
dead a South Korean tourist who allegedly strayed into an off-limits military
zone.
Hyundai Group's business unit, Hyundai Asan Corp., suffered 150 billion won
(US$121 million) in losses from the suspension and was forced to cut its
workforce to about 400 from more than 1,000 this year. Seoul has not yet shown
any sign of lifting the ban.
"Under the U.N. sanctions, it's difficult to expand tourism and other joint
economic projects that involve cash," Koh said. "I believe what they could do
under these circumstances was just have some friendly talk and share a consensus
that economic cooperation should go on."
Seoul officials denied Hyun carried any message from President Lee Myung-bak or
that she would play a role as a presidential envoy. In an anniversary speech
marking Liberation Day on Saturday, Lee reiterated his hardline policy over North
Korea's nuclear weapons program, conditioning economic aid on its
denuclearization.
Cross-border tension is expected to rise when South Korea and the United States
begin a joint military exercise this week. North Korea has warned of a "merciless
retaliation" against such drills.
Yang Moo-jin, a professor at the University of North Korea Studies in Seoul, said
North Korea tossed the ball into the Lee government's court by demonstrating its
willingness to continue joint projects.
"Hyundai and North Korea likely agreed that inter-Korean economic cooperation
should continue, and that there should be a role to be played by the Lee
Myung-bak government," he said. "But judging from the president's Liberation Day
speech and the Lee administration playing a leading role in the U.N. sanctions,
I'm pessimistic there will be any shift in the South Korean stance."
Hyundai's last-remaining joint venture, the Kaesong industrial park, also faces
uncertainty as North Korea is demanding hefty hikes in wages and rent. The
industrial park is a rare source of cash for the North, with more than $26
million paid in wages last year.
Hyundai Group has so far invested $1.2 billion in North Korea. Its late founder
Chung Ju-yung, a native of what is now North Korea, drove 500 head of cattle
across the border into North Korea in 1998 in a symbolic gesture to open up
business relations.
His son who succeeded him in the group, Chung Mong-hun, took his own life in
2003 amid mounting deficits from the North Korea projects and an investigation
into an alleged payment to North Korea. Taking over her husband's position, Hyun
vowed to continue North Korea ventures despite their uncertainties.
hkim@yna.co.kr
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