A British businessman with close ties to North Korea said yesterday that the chief executive of its new special administrative region was still likely to be a foreigner. Meanwhile, Chinese scholars said the job - which looks increasingly unlikely to go to controversial tycoon Yang Bin - could be a poisoned chalice. Yang was arrested last Friday in Shenyang on suspicion of tax evasion and other illegal activities. His whereabouts are unknown and his mobile phone was still switched off yesterday. Beijing's decision to arrest Yang, just 10 days after he received his letter of appointment as chief executive of the Sinuiju SAR, and its subsequent public comments about him indicate he faces a lengthy investigation and will not be able to take up the post. However Song Il-hyok, North Korea consul in Hong Kong, said yesterday he did not think Yang's arrest was a major setback. 'The country has decided to push ahead with a type of economic strategy and the strategy has not changed,' he said. Roger Barrett, managing director of Korea Business Consultants, which works to attract foreign investment to North Korea, said Pyongyang was very likely to select another foreigner for the post because he or she would be subject to less pressure. 'The foreign business community would be encouraged by a less controversial character [than Yang]. The announcement of the SAR had a very positive effect on stimulating interest, but subsequent events have given investors second thoughts. Venture capital firms are now looking seriously at [North Korea].' But Ge Zhenjia, an East Asian specialist at the International Studies College of Beijing University, said few people would dare to take the job. 'When North Korea chose Yang Bin, strange and secret things happened. Whoever takes the job, things will not go smoothly. 'Maybe someone from Taiwan or Hong Kong will take the post, but not from the mainland.' An official at the Asian department of the Ministry of Foreign Trade and Economic Co-operation said it was impossible to predict whether the SAR would attract investment from China and that Chinese firms remained cautious. Such comments indicate that Beijing wants to be consulted about the choice of Yang's replacement and would prefer a slower pace of change in Sinuiju than that envisaged by Yang, who planned to demolish most of the existing buildings and replace its population of 500,000 with young, technically qualified people. 'The issue is whether the SAR has any future if it is just a copy of special economic zones in China,' said one Asian diplomat. 'It has to offer something that is not available in China, like casinos or tax-free status. Otherwise, why would anyone invest there?'