Ex-envoy defends diamond deal

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Ex-envoy defends diamond deal


Kim Eun-seok

The senior diplomat at the center of an inside information scandal about a diamond mine in Cameroon says he’s a victim of political intrigue and that he should get a medal for his work rather than being relieved of his duties.

“It started with an attack against [former Knowledge] Vice Minister Park Young-joon, but as they found nothing to trap him with, [they are attacking me now],” Kim Eun-seok said in an interview with the JoongAng Ilbo on Wednesday.

Kim said he did such good work for the nation with the diamond mine that he expected a medal from the government. The mine development, he thought, would boost Koreans’ interest in resource diplomacy in Africa, he said. Kim, who has been relieved of his duties as Korea’s energy resource ambassador over the scandal, also denied the result of the Board of Audit and Inspection’s investigation which blamed him of knowing in advance that a Foreign Ministry release describing the Cameroon diamond mine was highly exaggerated. He also denied telling his two younger brothers to buy stock in a Korean company developing the mine before the press release came out. The BAI said the brothers bought stock in CNK International, the local developer.

Kim said he visited Africa 11 times over the past three years out of his sense of duty to do service for Korea.

A Dec. 17, 2010 press release issued by the Ministry of Foreign Affairs and Trade pushed up the stock of CNK International, and people who made money on the stock are under investigation over whether they had inside information before the release.

Following are excerpts from the interview.

Q. The diamond reserves described in the press release, 420 million carats, turned out to be an exaggeration. Did you know that?

A. I did not take care of the details. I am a diplomat, not a person who has dealt for a long time with energy resource related works .?.?. I thought everything was okay with the Cameroon government’s decision. The Cameroon government accepted the diamond reserves figure the company provided and gave development rights to the company according to the country’s due legal process. I don’t think 420 million carats was a false estimate. I believed the Cameroon government.

Your claim during the parliamentary audit last year that the diamond reserves figure came from the United Nations Development Program, as the press release stated, also turned out to be false.

I didn’t check the details one by one. I didn’t look into them clearly and I regret that. But it is true that UNDP reports have various reports of diamond reserves in the region, including that up to 4,000 carats per month are being produced. That became the basis for CNK’s own research.

What do you say about suspicions of your role in manipulating the stock price?

I didn’t imagine, even in my dreams, that this [press release] would have such an effect on the stock of the company. I thought it would rise some, and that’s a good thing, but I didn’t expect such a fuss and that people would take advantage of this. Had I known that, I wouldn’t have done such a crazy thing, would I?

What do you think about the result of the BAI investigation?

The BAI is very political. It did not listen to my side of the story at all and conducted a unilateral investigation. It is responsible for making it this big.

What about the accuracy of the investigation?

My secretary had 30 million won ($26,814) worth of stock in the company, but the BAI said that it was about 500 million won. There is a possibility that the figures they announced could be wrong. If the press release [from the foreign ministry] was wrong, the report of the BAI could be wrong too.

Did you recommend the stocks of CNK International to your brothers?

I met one brother during Lunar New Year [a few years back] and he asked whether there were diamonds in Cameroon. I answered that there were and a local company was working to develop them, but I don’t know the details. That’s all I said to him. It was one year and nine months before the company announced that it won the rights to develop the diamond mine, so I couldn’t have had much information about that and I wasn’t sure it would be a success at the time.

Did you contact Park Young-joon before or after the press release was issued?

I think I talked with him on the phone. He just said it [the issuing of the press release] was good. I talked with him a lot on the phone because we were both dealing with energy resources work, and we worked together at the Prime Minister’s Office.

There is a rumor that you were focused on CNK because of your relationship with Cho Jung-pyo. [Cho, a former Prime Minister’s Office secretary, has served as an executive of CNK International since 2009. Kim worked for Cho at the Prime Minister’s Office.] Is it true?

I haven’t seen him that much.

What do you think about CNK chairman Oh Deok-gyun?

I have mixed feelings about him now. It’s because of him that this became such a scandal. But I wish him success. In order for this ruckus to be resolved, [the diamond business] should turn out to be success.

By Cho Hyun-suk [joe@joongang.co.kr]
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