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Investment
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2001-05-07 17:15:00-04
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North Korea ready for Foreign Investment
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Next to last bastion of Communism changes attitudes and looks for foreign investment, will cultural changes follow?
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Long-time economic consultants indicate that North Korea is now ready for foreign investment. Apparently the people have been prepared for changes according to Roger Barrett, chief representative for the Foreign Business Development Association, which aids foreign companies interested in investing in North Korea. According to Barrett, North Korea does not have a high level of exposure or penetration to foreign companies and therefore there is a greater need to get such companies involved, hence, the attitude change. Many countries, especially European countries, have opened diplomatic relations with North Korea and that development has spurred the interest of the private sector in doing business. The main areas that interest Western firms at this point are light manufacturing and export processing such as textiles and electronic components, Barrett says. The favored location for such industries is the Rajin-Sonborg trade zone, which borders Russia and China and is similar to the special trade zones that China developed in the early 1980s. Barrett reports, however, that activity is still in the early stages and that no critical mass has been developed. The latest development has been some firms looking at the possibility of steel production. Key problems facing North Korea for further development include the severe energy shortage. Barrett indicates that the North Koreans are critical of the slow response from the United States in living up to treaty agreements, especially the slow delivery of heavy fuel oil mandated by a 1994 agreement. The situation vis a vis the United States has worsened since the advent of the xenophobic Bush administration, Barrett indicates.
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