Official who fell from grace in the North in new post

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Official who fell from grace in the North in new post

A former North Korean trade minister who had fallen out of favor has assumed a senior post in the ruling Workers’ Party to handle inter-Korean economic exchanges, sources said yesterday. An intelligence official in the South Korean government said Ri Kwang-gun, the former minister of foreign trade, is working as a deputy director of the United Front Department at the Workers’ Party. Ri had been fired as the minister in 2004 but returned early 2009 as deputy head of Office 39 and ended up in the current department late last year. Office 39 manages political funds and Kim Jong-il’s personal finances, and the United Front Department is charged with inter-Korean businesses.

Another source in China said Ri had previously run a trading company and served as an economic counselor at the North Korean mission in Germany. “Ri has long handled economic issues and he is now responsible for the National Economic Cooperation Federation’s dealings with inter-Korean cooperation,” the source said. “Kim Jong-il had placed Ri at the department because he felt the department lacked economic expertise.”

In 2005, during a time of active inter-Korean exchanges, the federation was promoted to the National Economic Federation Committee and became part of the North Korean cabinet. But in late 2007, several high-ranking officials, including committee chief Jong Woon-up, Chinese branch head Ho Su-rim, and Dandong regional head O Kwang-sik, were punished for various corruption charges.

The committee was demoted to a federation in 2008. After the North’s cabinet reshuffle last April, the federation was not on the list of ministries and agencies, prompting the Unification Ministry in Seoul to conclude that it had folded. The ministry last month learned that the federation had moved under the auspices of the Workers’ Party. Ri became the foreign trade minister in 2000 at age 47. But four years later, when a Workers’ Party official staged a lavish wedding for his daughter, Ri was among the senior government officials who were fired for attending. But Ri is now back in the fold. And the North has apparently given power to the United Front Department to handle the economy and foreign investments.

Kim Yang-gon, head of the department, is doubling as head of the Korea Taepung International Investment Group, which will provide funding for a soon-to-be built state bank. Won Tong-yon, another department deputy director, is the director general of the investment group. Pyonggon Investment Group, which was recently founded and is seeking investors for apartment construction in Pyongyang, is also reportedly under the department’s control.

“North Korea is trying to develop into a prosperous nation by 2012, and Kim Jong-il must be desperate for economy experts,” said Lee Jo-won, political science professor at Chung-Ang University in Seoul. “Moving Ri to the department shows that the North wants to draw investment from South Korea.”

By Jeong Yong-soo []
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