By Baek Byung-yeul
Expectations are growing over the visit by the heads of the nation's top four chaebol groups to North Korea, as it could lay the foundation for genuine economic cooperation between the two Koreas, company officials said Monday.
It is likely that, among others, Samsung and LG could build home appliance plants using cheap North Korean labor if international sanctions are lifted from the authoritarian state, according to the officials.
Hyundai Motor will likely mobilize its construction and railway car making units to build more roads and railways north of the border, while SK can improve North Korea's telecommunication and energy infrastructure, they said.
Cheong Wa Dae announced Sunday that top business leaders will visit Pyongyang as presidential delegates for the inter-Korean summit from today until Thursday.
The list includes Samsung Electronics Vice Chairman Lee Jae-yong, SK Group Chairman Chey Tae-won, LG Group Chairman Koo Kwang-mo, Hyundai Group Chairwoman Hyun Jeong-eun, Hyundai Motor Group Vice Chairman Kim Yong-hwan and POCSO Chairman Choi Jeong-woo.
Though international sanctions against North Korea have remained intact, industry watchers presume their visit to Pyongyang would become a chance to draw new businesses there after the sanctions on North Korea are lifted.
For Samsung, this marks the first time its chief makes a visit to Pyongyang. During the inter-Korea summit in 2000 and 2007, Samsung Group Chairman Lee Kun-hee didn't visit Pyongyang for health reasons.
To take advantage of North Korea's cheap labor, Samsung used TV components produced in North Korea, but it had cut all business ties with North Korea following the sinking of a South Korean warship in 2010.
It remains to be seen whether Samsung can make possible talks on business cooperation, but a Samsung spokesman said "Lee will visit Pyongyang only as a member of the delegation."
LG's new chairman is also in the spotlight as the Pyongyang visit will be his debut as leader of the country's fourth-largest conglomerate. LG operated a TV assembly project in the North from 1996 to 2009.
For SK Group Chairman Chey, this will be his second visit to Pyongyang following his first in 2007. The possible talks on inter-Korean business cooperation would be a chance for SK Group which has a business portfolio ranging from telecommunications, construction, energy and construction and semiconductors.
"Chey may plan a business model in the North but nothing has been confirmed yet," an SK Group spokesman said.
Hyundai Motor Group will send its vice chairman Kim. Once the sanctions against North Korea are lifted, the group is expected to join the construction and railway businesses there.
Hyundai Group Chairwoman Hyun will also visit Pyongyang. As operator of the now-suspended tourism project, Hyundai had operated a tour program to Mount Geumgang since 1998 but the tour was halted in 2009 after a North Korean soldier shot dead a South Korean tourist for wandering off-limits.
Im Jong-seok, presidential chief of staff and chair of the inter-Korean summit preparatory committee, told reporters Monday that the business delegation will have a meeting with Ri Yong-nam, North Korea's deputy prime minister for economy, on the first day of the summit.
Im said the business delegation is expected to discuss economic cooperation based on which the North and the South agreed upon the Panmunjeon Declaration last April. During Moon and Kim's first inter-Korean summit in April, the two agreed to promote balanced economic growth and co-prosperity.
"As international sanctions have been imposed on North Korea, there is a clear boundary of acceptable and unacceptable actions we can take," Im said. "However, we will do our best to make progress."
Analysts expect President Moon's third summit with Kim will serve as momentum for South Korean companies related to North Korea.
Kim Byung-yeon, a researcher at NH Investment & Securities, said the improved inter-Korean relations would "foster three strong economic strongholds on the North's west and east coasts and the DMZ."
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| Samsung Electronics Vice Chairman Lee Jae-yong |
It is likely that, among others, Samsung and LG could build home appliance plants using cheap North Korean labor if international sanctions are lifted from the authoritarian state, according to the officials.
Hyundai Motor will likely mobilize its construction and railway car making units to build more roads and railways north of the border, while SK can improve North Korea's telecommunication and energy infrastructure, they said.
Cheong Wa Dae announced Sunday that top business leaders will visit Pyongyang as presidential delegates for the inter-Korean summit from today until Thursday.
The list includes Samsung Electronics Vice Chairman Lee Jae-yong, SK Group Chairman Chey Tae-won, LG Group Chairman Koo Kwang-mo, Hyundai Group Chairwoman Hyun Jeong-eun, Hyundai Motor Group Vice Chairman Kim Yong-hwan and POCSO Chairman Choi Jeong-woo.
Though international sanctions against North Korea have remained intact, industry watchers presume their visit to Pyongyang would become a chance to draw new businesses there after the sanctions on North Korea are lifted.
For Samsung, this marks the first time its chief makes a visit to Pyongyang. During the inter-Korea summit in 2000 and 2007, Samsung Group Chairman Lee Kun-hee didn't visit Pyongyang for health reasons.
To take advantage of North Korea's cheap labor, Samsung used TV components produced in North Korea, but it had cut all business ties with North Korea following the sinking of a South Korean warship in 2010.
It remains to be seen whether Samsung can make possible talks on business cooperation, but a Samsung spokesman said "Lee will visit Pyongyang only as a member of the delegation."
LG's new chairman is also in the spotlight as the Pyongyang visit will be his debut as leader of the country's fourth-largest conglomerate. LG operated a TV assembly project in the North from 1996 to 2009.
For SK Group Chairman Chey, this will be his second visit to Pyongyang following his first in 2007. The possible talks on inter-Korean business cooperation would be a chance for SK Group which has a business portfolio ranging from telecommunications, construction, energy and construction and semiconductors.
"Chey may plan a business model in the North but nothing has been confirmed yet," an SK Group spokesman said.
Hyundai Motor Group will send its vice chairman Kim. Once the sanctions against North Korea are lifted, the group is expected to join the construction and railway businesses there.
Hyundai Group Chairwoman Hyun will also visit Pyongyang. As operator of the now-suspended tourism project, Hyundai had operated a tour program to Mount Geumgang since 1998 but the tour was halted in 2009 after a North Korean soldier shot dead a South Korean tourist for wandering off-limits.
Im Jong-seok, presidential chief of staff and chair of the inter-Korean summit preparatory committee, told reporters Monday that the business delegation will have a meeting with Ri Yong-nam, North Korea's deputy prime minister for economy, on the first day of the summit.
Im said the business delegation is expected to discuss economic cooperation based on which the North and the South agreed upon the Panmunjeon Declaration last April. During Moon and Kim's first inter-Korean summit in April, the two agreed to promote balanced economic growth and co-prosperity.
"As international sanctions have been imposed on North Korea, there is a clear boundary of acceptable and unacceptable actions we can take," Im said. "However, we will do our best to make progress."
Analysts expect President Moon's third summit with Kim will serve as momentum for South Korean companies related to North Korea.
Kim Byung-yeon, a researcher at NH Investment & Securities, said the improved inter-Korean relations would "foster three strong economic strongholds on the North's west and east coasts and the DMZ."
