World Economy

US Promises Investments in N. Korea After Nuclear Deal

Kim Jong-un (R) receives Mike Pompeo in Pyong Yang on May 9.Kim Jong-un (R) receives Mike Pompeo in Pyong Yang on May 9.

The United States has said it may let American businesses invest in North Korea if the two sides reach a nuclear agreement. But even if US economic restrictions against the North are lifted, the country would likely still present a difficult environment for foreign investment.

The US government wants North Korea to end its nuclear activities. Secretary of State Mike Pompeo noted on Sunday that President Donald Trump has called for the complete, verifiable and irreversible denuclearization of the North, VoA reported.

Pompeo added that, if North Korean leader Kim Jong-un agrees to disarm, the US could offer foreign investment “in spades”.

Pompeo told Fox News, “This will be Americans coming in…not the US taxpayer…to help build out the energy grid.” He added that American businesses could help the North develop its infrastructure, (and) all the things that the North Korean people they can eat meat and live healthy lives.”

The secretary of state recently returned from a trip to Pyongyang, where he met with the North Korean leader. The meeting was set up to prepare for Kim’s talks with Trump. The two leaders are to meet in Singapore on June 12. The North Korean government released three American prisoners to Pompeo as a humanitarian gesture.

The Trump administration is increasingly hopeful it can work out an agreement with the North Korean government.

Last month, the North Korean leader met with South Korean President Moon-Jae-in. During that meeting, Kim agreed to the denuclearization of the Korean Peninsula. Kim said that he wants an end to the US-led restrictions, which ban 90% of North Korea’s trade exports. Those measures were announced because of his country’s repeated nuclear and missile tests.

The North Korean government recently announced it would take apart its nuclear bomb test area between May 23 and 25. However, the North has argued for a slower denuclearization process that would provide immediate actions for each step taken. It is not clear how North Korean and US officials can resolve the differences over their positions.

It is also unclear if foreign investors would be prepared to put millions of dollars in investments into North Korea after sanctions are ended and a nuclear deal is in place.

“The administration is perhaps inflating expectations of what the North Koreans can expect in terms of private investment,” said Andray Abrahamian. He was once involved in developing business training programs for North Koreans.

Abrahamian noted that banks and financial companies will have concerns about the business climate in the North.

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