Wednesday. 26 October 2016

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Ex-Hyundai chief sought closer business links with Soviets

Senior Soviet aides advised Mikhail Gorbachev in 1990 when he was Soviet president to develop closer business ties with South Korea.

Gorbachev’s foreign policy adviser, Anatoly Chernyaev, advised him to discuss how to do this with the founder and then head of the Hyundai group, the late Chung Ju-yung.

Gorbachev agreed to Chernyaev’s suggestion to arrange an urgent meeting with the South Korean billionaire businessman.

Chung Ju-yung [founder of the Hyundai group] is a very acceptable figure to the leaders of North Korea

Anatoly Chernyaev’s memo to Mikhail Gorbachev in 1990

In a secret memo to Gorbachev of November 1990, Chernyaev said that the businessman is “unofficially called the ‘economic president’ of the country,” and “a staunch supporter of Soviet-South Korean economic co-operation”.

The Hyundai chief was keen to develop business links with Moscow, and became a co-president of the Korean-Soviet Economic Association. In Soviet archival documents, he is portrayed as a key figure for relations between the Soviet Union and South Korea.

He, said Chernyaev’s memo, “talked about great potential for co-operation between the two countries. He emphasised the idea that South Korea should take a more prominent – in many areas, the leading – place in the Soviet Union's economic relations in the Asia and Pacific region.” Chernyaev headed his memo to Gorbachev: “It would be good if you could find time for a short meeting with Mr Chung Ju-yung.”

He gave Gorbachev a detailed brief on the businessman and the Hyundai group, describing it as “the biggest conglomerate in South Korea” and the “symbol of South Korean ‘economic miracle’”, as well as of its joint business projects with the Soviet Union.

The Hyundai chief hoped that stronger economic ties could bring peace between South Korea and the communist state of North Korea, said the memo.

“According to employees of Hyundai, Chung Ju-yung, who was born in North Korea, has decided to devote the rest of his life to restoring the peaceful climate on the Korean Peninsula. He believes this can be done by developing co-operation with the USSR, and involving North Korea into that co-operation.

“Chung Ju-yung is a very acceptable figure to the leaders of North Korea.”

Gorbachev received a report from another aide at about the same time on proposals for massive loans to the Soviet Union in 1990 in return for a troop deployment against Iraq, following its invasion of Kuwait.

These proposals were said to be set out by Shin Kyuk-Ho, the South Korean billionaire businessman, founder and chief executive of the Seoul-based multinational conglomerate, Lotte Group.

The aide, according to his report, was urged to meet this businessman by the Hyundai chief: “Korean businessman Chung Ju-yung, who is known to you, strongly recommended me to meet Shin Kyuk-Ho, the proprietor of a major international corporation, Lotte.”

Pavel Stroilov is a Russian journalist and political exile living in London, and author of ‘Behind the Desert Storm’. Additional reporting by Alanah Eriksen.

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