Jim Rogers calls Gaeseong park shutdown a mistake

Jim Rogers / Korea Times file

Legendary investor calls on S. Korea to help N. Korea open economy

By Kim Jae-kyoung

SINGAPORE ― Legendary investor Jim Rogers called for South Korea to put a greater focus on taking measures to help North Korea open and reform its economy rather than holding war games every year.

Rogers said that unification will become a breakthrough for Korea to overcome various economic challenges.

"All you have to do is to take down the demilitarized zone. Stop spending money on defense. You had those war games every year for 50 years," said Rogers, chairman of Rogers Holdings, in an exclusive interview with The Korea Times in his residence in Singapore.

He said Seoul needs to take steps to expedite the opening of North Korea, instead of further isolating the country.

Rogers expressed skepticism about the effect of President Park Geun-hye's decision to shut down the Gaesong Industrial Complex.

"I am a fan of President Park more than any other politicians but that was a mistake if you ask me. When she closed the complex, I was surprised. That was pretty negative for South Koreans," he said. "I know she has an election in April. It is one of the few times I thought she was making a mistake."

His view comes amid growing geopolitical tension on the Korean Peninsula following North Korea's provocative actions and subsequent U.N. sanctions against the reclusive country.

Describing himself as a big fan of Korea, the 73-year-old said that North Korean leader Kim Jong-un is trying to use nuclear brinkmanship to get leverage in negotiations with the U.S. and South Korea.

"We now know negotiations were set, but then the U.S. pulled out so I presume that was his reason. He seems to want peace," he said.

Rogers, who has visited the isolated country twice, believes that North Korea will follow in the footsteps of China in market opening and economic reform.

"They already started. They already have 15 free trade zones. The reason why there is so little investment from abroad is they just started," he said.

He explained that Deng Xiaoping in 1978 said China was going to change the world but in 1981, most people still couldn't see any change. In 1981 Shenzen was just a fishing village but now it has eight million people and is the most exciting city in the world.

"It takes a while for this to take place. He (Kim) does have 15 free trade zones. You can go on bicycle tours, you can go skiing, and you can take a movie tour (in North Korea). That's what you could not do before. Those are what his father and grandfather did not allow," he said.

Most exciting country

Rogers said Korea will become the most exciting country in the world if the two Koreas are unified.

"I don't think unification will happen in the foreseeable future. But when it comes, Korea will be the most exciting country in the world for a decade or two."

He said the unified Korea will be attractive enough for him to invest most of his assets.

Rogers warns world economy will face worst crisis yet

2016-03-13 15:25 | Economy

"Once unified, it will grow faster than others and it will have a lot of dynamic things happening. You have 75 to 80 million people right on the Chinese border," he said. "I will bet on a very exciting Korean Peninsula and may well invest most of my wealth there."

Rogers is one of the world's three most famous investors together with George Soros and Warren Buffet.

The multimillionaire investor said that the North has lots of natural resources and a lot of cheap, disciplined labor, while the South has lots of capital, knowhow, and a large market.

"So when you put two countries together, while everybody else is suffering, you will have dynamics that other countries won't have at the time," he said. "That is a reason you need unification. They need you and you need them in the future."

Global financial crisis

In the meantime, he expects the global financial market to face its worst-ever crisis in the coming years.

He expects that economic turmoil caused by snowballing debt around the world will send the financial market to rock bottom this time.

"We are going to have serious problems in 2016 and 2017. It will be worse than 2008," Rogers said.

"I expect markets to collapse like they did in 2008. It started in the middle of 2014 and that has been going worse and worse. I don't know when the market will hit rock bottom but probably next year will be the worst."

In order to head off economic challenges, there are two areas Korea should work on with urgency _ opening its economy and lowering debt, according to the international investor.

"First, open your economy more because you still have a lot of trade barriers. Get rid of regulations and tariffs," he said.

"Also, try to do something to start lowering your debt. You have more debt than you should. That's going to cause a lot of people to suffer."

Interested in Korean startup

Rogers, who moved to Singapore several years ago, said that he will soon invest in another Korean startup.

In January, he made his first investment in Illimus.

"I am investing in people, not in companies. I was impressed by the people and what they are doing. They are hardworking, smart and energetic with good ideas. This is something I've very rarely, rarely done in my life," he said. But he refused to reveal the investment amount.

Trump presidency a disaster

The co-founder of the Quantum Fund said that if Donald Trump is elected as the president of the United States, it will be a disaster for the world as well as the U.S.

"In America, usually when we had problem, a man or woman on white horse showed up and said, ‘Don't worry. I will save you.' Then he or she becomes a leader and they make things worse. They lead to bankruptcies and wars," he said.

"Right now we got people like Donald Trump. He says, ‘Don't worry. I will save the world.' Conceivably, Trump and someone like him would be elected. If he does what he says, it will lead to trade wars all over the world."