Korea-US Strategic Investment Corp. grilled over risk management
Park Jong-won, president of the Korea-U.S. Strategic Investment Corp., speaks during a parliamentary audit at the National Assembly in Seoul, Tuesday. Yonhap
Korea-U.S. Strategic Investment Corp. was grilled by lawmakers from both ruling and opposition parties Tuesday during a National Assembly audit over its ability to manage risks associated with Korea's $350 billion U.S. investment commitment.
The audit marked the first since the corporation's launch in June, as Korea has begun making payments under the investment agreement.
"Had it not been for U.S. President Donald Trump's unusual tariff policies, this kind of investment would have been difficult to pursue," Rep. Jung Sung-ho of the ruling Democratic Party of Korea said.
Jung questioned whether the corporation had sufficient legal expertise to manage the risks, pointing out that its risk management committee had only one American lawyer.
Rep. Lee Jong-wook of the main opposition People Power Party criticized what he described as inadequate risk management, pointing to the corporation's handling of a $2.4 billion remittance for Project Star, a planned energy project in Texas selected as the first investment project.
"The corporation had already remitted $2.4 billion for Project Star, but the risk management committee meeting required by law was held only after the transfer," Lee said.
The corporation's staffing also came under scrutiny.
The organization currently has 32 employees among an authorized headcount of 50. Its strategic investment division chief also resigned just two months after taking office, leaving the post vacant.
"We conducted risk assessments in consultation with the government during the decision-making process," Park Jong-won, the corporation's president, said in response to lawmakers' questions.
"We will fill vacancies, continue recruiting legal experts and engage major external law firms to manage risks related to contract implementation and potential disputes," he added.
Established in June, the state-run corporation is responsible for reviewing U.S.-bound investment projects, securing funding and managing investments. Under the $350 billion investment agreement, Korea will provide $200 billion in cash investments, capped at $20 billion annually, in return for lower tariffs.