International Law

Making Money in Pyongyang -- This is No Hallucination

On the subject of North Korea, it isn't widely known that some Westerners are actually in residence in Pyongyang doing business there -- profitably.

But here, courtesy of North Korean Economy Watch, we read a fascinating interview with Felix Abt, formerly Asea Brown Boveri (ABB) rep in the DPRK, who now represents in his own agency European multinationals with a claimed annual sales of several USD millions:

Klaus-Martin Meyer: Felix Abt, you came as country director for the ABB group to North Korea in 2002 where you have been resident since. ABB closed its representation just about 2 years after your arrival but you have successfully been involved in a number of other businesses since then. What happened?

Felix Abt: At the time the Swiss-Swedish ABB, a global leader in power and automation technologies, not only faced huge asbesto claims in the United States but also large debts versus a tiny equity that culminated then into a matter of life or death for the group. To survive it decided to immediately save 800 million USD cash expenses, making the closure of a number of factories and offices around the globe unavoidable.

Though we at ABB Pyongyang fully covered our cost through sufficient sales with a good margin the funds and other resources necessary to set up the planned joint ventures I had been negotiating, however promising they may have become, were definitely not available any longer. In addition the pre-contracts I secured for ABB ? including one for a 9-digit USD infrastructure project I signed at the dismay of the competitors in presence of the Swiss foreign minister, the Swedish ambassador and the North Korean minister of power and coal industries ? would have required even more substantial funding. Given ABB?s critical financial condition...

ABB Pyongyang? Already I am green with envy. What an adventure!

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Full post as published by Asia Business Intelligence on September 10, 2008 (boomark / email).