     • 

CHAPTER 14

Doing Business with North Korea

F

ollowing retirement from the U.S. Army, I began a second career
as a business consultant to several American companies engaged
in business ventures in Asia. Almost all of these companies were
engaged in the sale of nondefense items—computer software, res-
taurant franchises, marine engines, ship propellers, and such—so it was a
whole new experience. This business often brought me back to South Ko-
rea and other Asian countries, and I was able to see my many Korean friends
from time to time. Most of my work centered on helping American compa-
nies find the right partners or local agents, setting up marketing plans, as-
sisting in contract negotiations, and culturally adjusting to the Asian way
of doing business.
In early  a New York–based company contacted me expressing an
interest in obtaining magnesite from North Korea. Magnesite is a mineral
used in a number of commercial applications, particularly in the steel in-
dustry. Much of the world’s supply of magnesite is located in northeast
China and North Korea, and the company believed that it would be advan-
tageous to open up the market in the latter. I was asked if I could assist in
this project by lending consulting expertise. After gathering more informa-
tion, I determined that the project was feasible and agreed to assist.
At the time, all American trade with North Korea was restricted, so the
first order of business was to obtain U.S. government approval to deal with
the North Koreans. This involved permission from both the State Depart-
ment and the Treasury Department, since any potential business dealing
with North Korea would have political implications and involve transfer
of funds, both requiring an exception to policy. On a one-time-exception
basis, we were eventually able to receive both departments’ approval to
proceed.
The next step was to contact the right people in Pyongyang, and in this
we were assisted by the North Korean U.N. office in New York. After numer-
ous phone calls, faxes, and several meetings, it was agreed that the North
Koreans would send a delegation to New York to negotiate what would hope-