Pyongyang struggling to woo Chinese investors

Ri Su-yong, whom the cash-strapped North Korea ambitiously appointed as its new top investment envoy last year, is struggling to get money and projects from Pyongyang’s closest ally China, sources told the JoongAng Ilbo.

The sources said Ri, better known as his alias Ri Chol, visited China at least twice last year trying to lure Chinese investment in the North.

“Ri Su-yong came to China once in the summer and again in October,” said a Beijing source.

But he hasn’t achieved much from the visits. Chinese companies, citing distrust of North Korea and the risks inherent in pumping money into the isolated country, have yet to respond, the source said.

“China is passive about investing in North Korea because it has barely made a profit from previous investments and has instead suffered fraud a substantial number of times,” said another source. “North Korea is even asking the Chinese government to provide [an agreement] for the risks Chinese companies will have to bear for investing in the North.”

Ri, 76, has been fingered as Kim Jong-il’s chief overseas slush-fund manager, handling an estimated 4.5 trillion won ($4 billion). He was appointed as North Korea’s ambassador to the UN in Geneva in 1987 and served as North Korean ambassador to Switzerland from 1998 to 2010.

Last March, Ri returned to Pyongyang and four months later was appointed as the head of an investment company set up by Jang Song-thaek, Kim Jong-il’s brother-in-law and vice chairman of North Korea’s National Defense Commission.

North Korea has reached out to bring in investment from overseas, particularly since sanctions were imposed by the UN in 2009 and since South Korea’s suspension of inter-Korean business exchanges after the Cheonan sinking last March. But, their moves have been seen as unsuccessful so far.

Officials at the Korea Taepung International Investment Group, another front company the North established as a foreign investment channel, were reproached recently by the country’s leadership for lack of performance, sources said.

The company announced last year its goal of attracting $10 billion in foreign investment.

“Ri will likely visit China again because enticing investment is a task ordered by Kim Jong-il,” said another source.

Meanwhile, Ri, who was rumored to be going to China ahead of Kim Jong-il’s birthday to buy presents, was not aboard an Air Koryo plane arriving in Beijing Tuesday. Kim’s birthday was yesterday.

By Chang Se-jeong, Moon Gwang-lip [joe@joongang.co.kr]