Ideal places for business in North Korea

A local report indicated that Pyongyang-Nampo and Sinuiju are two most promising areas in North Korea for investment by South Korean companies.

The Hyundai Economic Research Institute pointed out that the conditions of promising areas for investment in North Korea are: an urban area with nearby port, a place with the industrial infrastructure, a place that wouldn`t affect the North Korean society that North Korean authorities find it easy to accommodate, a place with an easy economic access to neighboring countries, and a place like Pyongyang-Nampo area or Sinuiju area where its easy to secure manpower.

Already, there are some Korean companies in Pyongyang-Nampo area, the central region of North Korea where higher educational institutions are concentrated and easy to secure the educated manpower. Also, the region is likely to emerge as an attractive location if North Koreans` income grows.

Sinuiju area, as the North Korea`s leading trading center, handles 80%-90% of trades between North Korea and China. It is a place that North Korean authorities recommend the best to South Korean companies.

The institute indicated that Wonsan-Hamhung area has an excellent infrastructure for heavy industries, so an investment in the area with light industry facilities in the North would be not the priority at the first stage of the South-North economic cooperation. Overall, it said that the west coast areas have better business environment than the east coast region.

Haeju-Kaesong area, which is very close to South Korea, would feature less transportation costs and companies could utilize South Korea`s surplus electric power. But, it is near the border area where military bases are concentrated, so it would be difficult for the North Korean authorities to accept such a request, the institute said.

Also, Najin-Sonbong area, which was created as a special district to attract foreign investment, is lacking in social over-head capital facilities as well as industrial infrastructure. It is considered as a failure site. But, investment in distribution and tourism business would be promising, the institute indicated.