North Korea

Working with North Korea 'sensible'

Hong Kong could have a useful role to play in assisting country develop its economy and it would help relationship with the mainland

PUBLISHED : Monday, 29 July, 2013, 12:00am
UPDATED : Monday, 29 July, 2013, 7:15am

Encouraging Hong Kong to design projects and invest in North Korea makes sense for both Pyongyang and Beijing, an international relations expert says.

Hong Kong International Relations Research Association chief research officer Steve Chung Wai-lok said it was a "sensible choice" for both countries to invite Hong Kong to play a part in the development of the country's economically reformed areas.

"The relationship between China and North Korea has become more fragile under international pressure in recent years," Chung said.

He was responding to questions about why North Korea's leader Kim Jong-un sought airport design and investment advice from Hong Kong for a special economic zone at Mount Kumgang, which South Korea's Hyundai Group started to help develop in 1998.

He said while North Korea had unexpectedly threatened the world with missile tests early this year, China was also under global pressure to impose economic sanctions on its close ally.

"In this context, Hong Kong has a role to play when the mainland cannot be seen as helping its ally officially," Chung said.

Chung said Hong Kong had a track record of investment in the country as local investors were invited to develop Sinuiju when the North Korean government designated it a special economic zone in 2002, including building resorts and international schools.

The development model was said to be based on Hong Kong, but it was eventually suspended after Yang Bin, appointed as the zone's chief executive by North Korea's then leader Kim Jong-il, was jailed for illegal business activities in 2003.

Chung wondered if Mount Kumgang would meet the same fate. "It's hard for the project to succeed without the support of South Korea, which is the most likely source of money and tourists," he said.

But professor Simon Shen Xu-hui, of the Social Science Faculty at the Chinese University, said Kim seemed to be interested in developing direct relations with the US. Inviting Hongkongers to work on the development plan would be seen as less "Chinese-oriented" and more westernised.

Kumgang tourism resort, in the country's south-east, is one of five special economic zones through which Pyongyang hopes to attract foreign investment.

But the resort's development was suspended after a South Korean housewife was shot dead by soldiers in 2008 when she wandered outside its perimeter fence to watch the sunrise.

In 2010, North Korea seized all assets owned by the South Korean government and froze those held by private firms. It also expelled any South Korean workers who remained to look after the resort's hotels and restaurants.

The North Korean government cancelled Hyundai's business licence and announced it would transform the site into an international resort on its own.

Commenting on the human rights dimensions of investing in North Korea, associate professor Ma Ngok of the government and public administration department at the Chinese University said Hong Kong people did not need to link business with rights issues in North Korea.

"We are only talking about designing airports," he said. "Of course, the business relationship could become more politically sensitive if we were to help them build prisons or nuclear weapons. But it is not the case here."