Orascom Construction Industries, a massive Egypt-based company that is 60 percent family owned, has decided to invest US$115 million to buy 50 percent of the Sangwon Cement Complex in North Korea’s North Pyongan Province, according to the WSJ, KCNA, and an Orascom press release [pdf]. Sangwon Cement reportedly began production in 1989 and is therefore relatively modern by North Korean standards. For some perspective, that’s more than four times the US$25 million Pyongyang had in Macao’s Banco Delta Asia.
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5 Comments
I also touched on this last night on my Korea Law Blog. It’s a really interesting play by Orascom looking toward infrastructure investment in North Korea (wonder where the money for that investment will come?) now that the nuclear issue is “taken care of”. We’ll see about that.
Sangwon Cement was finished in 1989 with the last of the foreign investment and bank-loan money from the mid-1980s, before North Korea defaulted on everything. Orascom is either going to come out looking like geniuses, or suckers. And that will depend in large part upon whether recent reports of North Korean opening are really going to come to pass, or whether they will be another will-o’-the-wisp bamboozling the world into believing in change.
http://news.naver.com/news/rea.....o_id=13707
Naver is carrying a three sentence summary of this, and one of those (not to mention all of the netzens below) is devoted to the name “Sea of Japan” being used on the map of the WSJ.
Saw this on Brendon’s site and agree that this is one of those genius/sucker gambles. Consider that even if the North collapsed, there would be a massive need for concrete in the construction projects related to relief. Culverts, bridge abuttments, tunnels, port improvement, road building, railway upgrades, etc. The possibilities make one wonder if Orascom is betting on the regime’s survival, or it’s collapse.
I’d be putting my money on sucker. The DPRK still has huge outstanding debts to foriegn companies/nations they screwed - 12 bilion at last estimate - why should this one be any different?
Obviously, WSJ’s use of the imperialistic “Sea of Japan” is the more important issue here. Get with the program, people!
[Heads off in a huff to protest mild-mannered Evan Ramstad.]
Back to reality, I’ve got W100K says the Egyptians lose their shorts by 2017. They’ve already got enough bunkers by now, right? And no more pyramid hotels that I know of.