South Korean companies have begun to explore potential business opportunities in the North.
This... as there's growing optimism the North may no longer be subject to crushing international sanctions,... providing it sticks to its pledge to denuclearize.
Kim Hyesung reports.
Hyundai Asan, the inter-Korean business arm of Hyundai Group, set up a special task force last month to explore business opportunities in North Korea.
It's gained further momentum following the North Korea-U.S. summit, where the two leaders agreed to work towards the complete denuclearization of the Korean Peninsula, which could eventually lead to the easing of economic sanctions against the North.
"We were the first South Korean company to do business in North Korea. We are closely looking into each and every possible scenario so we can do business once the conditions are right. In addition, we are coming up with mid-to-long term plans on how to use our SOC business rights in North Korea for infrastructure projects."
Hyundai Asan had operated a joint tour program at Mount Kumgang in North Korea and ran businesses at the Kaesong Industrial Complex for more than a decade, but it's not the only firm that's pinning its hopes on possible inter-Korean projects.
KT Corporation and retail giants like Lotte Group have also created task forces to prepare to expand into North Korea.
"From reconnecting railways and building roads to joint economic projects, North Korea's untapped economy is seen as full of business opportunities."
A combined Korean peninsula will boast a consumer market of 80 million people.
The Bank of Korea's data show North Korea's gross national income per capita was around 12-hundred U.S. dollars in 2015, less than 5 percent that of South Korea's, meaning there's huge potential for a rise in consumption in the future.
North Korea's underdeveloped roads and railways, and its needs for electricity and retail goods also mean business opportunities.
"South Korea has been struggling with a low fertility rate and an aging population. It's economic growth is unlikely to go above three percent in the future. But North Korea could provide a new growth engine. Transport links could open a pathway to enter the Eurasian continent. But these are huge infrastructure projects that would require enormous funding and consistency."
The lifting of UN sanctions, funding, investment protection... and numerous unforeseen challenges lie ahead.
But businesses are seeing opportunities, and are speeding up their preparations so that they can seize the opportunity if it arises.
Kim Hyesung, Arirang News.
