Greed’s Graveyard

The Washington Post has finally taken note of Hyundai’s troubles in North Korea, which continues to be a black hole for South Korean won:

[S]ince South Korea opened up friendly relations with the North in the late 1990s, more than 1,000 South Korean firms have gone bankrupt or lost significant investments in North Korea, according to South Korea’s Unification Ministry.

Most were small, low-tech enterprises involved in textile-making and rudimentary housewares. But the problems at Hyundai have shown that the fortunes of even the largest investors are linked to the whims of the North’s government.

“In the first place, there aren’t that many companies left that really want to go into there given the bad investment environment,” said Choi Soo Young, senior research fellow at the Seoul-based Korea Institute for National Unification. “But the Hyundai case shows how dangerous it can be to make the decision to invest in North Korea.”

My blog entry on Hyundai’s break with the North Korean regime is here.