Posted on 11/14/2011 2:38:45 PM PST by TigerLikesRooster
N. Korea irking foreign investors via double contracts
NOVEMBER 15, 2011 02:06
North Korea is striving to attract foreign investment to earn foreign currency ahead of its pledged transformation into “a great and powerful nation” next year, but a string of foreign-invested companies in the North are suffering damage.
According to sources on the North Monday, North Korean authorities have signed double contracts with foreign investors in the North in recent weeks. Even after signing contracts, Pyongyang has unilaterally disposed of assets on its own and rejected profit sharing, causing damage to companies.
In April last year, the North granted to two foreign companies the exclusive rights to develop a mine that a European venture capital firm had invested earlier. Upon learning this, the chairman of the venture firm reportedly visited the North in October last year and demanded an explanation from North Korean officials.
Another European entrepreneur who had been running a joint venture pig farm with the North since 2008 moved to halt operations there, citing unpaid account receivables. He then faced a murder threat.
Conflict also erupted in the course of attracting foreign investment to Musan Mine, the largest iron ore field in the North. Pyongyang is recklessly trying to induce investment targeting companies not only in China but also in Britain and India through its joint venture committee and Taepung Investment Group. This has fueled fears of double contracts with two different investors for a single project.
Chinese authorities complained about this to a senior North Korean official who visited China in May, demanding that Pyongyang take proper action.
The North Korean Embassy in Beijing and provincial governments in China have reportedly received a flurry of civil complaints like “We have yet to recover our large-scale loans from North Korea,” and “The North is redeploying human resources at its own will and delaying administrative assistance.”
In light of this situation, the Chinese Commerce Ministry is warning Chinese companies of the investment risk in North Korea after recommending that they slow the pace of investment in August.
Eighty-six investment companies of the General Association of Korean Residents in Japan, a pro-North Korea group also called Chochongryeon in Japan, have advanced to the North, but more than 80 percent of them have suspended projects there.
A source on North Korea said, “North Korea’s record of investment inducement is sluggish, and most of the investments are limited to small-size investments that can be repaid with materials in-kind over a short period of time,” adding, “This is because the North has a string of problems, including lack of understanding about capitalism and rampant corruption among government officials amid poor infrastructure and insufficient institutions.”
P!
Until the North Korean regime is destroyed, and I mean destroyed, there’s no hope for any kind of calm in that area of the world. The people there are so utterly brainwashed, it may not even be possible to get them back to reality.
Sounds like the wish that the W.H. occupant would want for this country !
There goes their Triple A rating.
There needs to be an international ban on any foreign investment into NorKland so it helps speed up their collapse.
Anybody who invests in North Korea deserves to lose all of their money.
Investments, contracts, North Korea??? Are there really companies and people stupid enough to make investments with North Korea? There are no such things as “contracts” in North Korea.
Anyone who “invests” in North Korea is simply asking to be ripped off.
Social justice. Redistribution of wealth on the international level.
N. Korea is a prime example of how welfare scheme goes wrong. You create an ungrateful and violent monster who has to depend on freebies permanently.
Wait until the Chi-coms face a rocky road.
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