A parliamentary inspection has revealed the problems of the Lee Myung-bak government’s attempt to develop overseas resources. With losses amounting to 50 trillion won, the financial disaster suffered by public enterprises, and allegations of corruption, the Lee government’s attempt at “resource diplomacy” has been revealed to be practically a catastrophic nightmare.

On October 22, the New Politics Alliance for Democracy aimed at the disastrous resource diplomacy of the Lee Myung-bak government. The opposition party revealed suspicions of corruption, proposed a parliamentary investigation to punish those responsible, and mentioned calling former President Lee Myung-bak to testify before the National Assembly.

At a press conference at the National Assembly this day, which marks a month since Moon Hee-sang became chairman of the opposition party’s emergency committee, Moon said, “We need to hold a parliamentary investigation when necessary, because no one is able to do anything about the country’s losses (from developing overseas resources) reaching in the tens of trillions of won.”

On the possibility of calling former President Lee to testify before the lawmakers, Moon said, “The National Assembly would have to deal with this issue since the nation suffered such huge losses due to the failure in resource diplomacy.”

At an emergency committee meeting, floor leader Woo Yoon-keun said, “We confirmed that the Lee Myung-bak government threw away hundreds of billions of won into projects to develop overseas resources. We will review the possibility of a parliamentary investigation of related agencies and personnel if necessary.”

The New Politics Alliance for Democracy targeted the incumbent Deputy Prime Minister for Economic Affairs Choi Kyung-hwan, who oversaw the projects to develop overseas resources as minister of Knowledge and Economy under the Lee Myung-bak government. Woo said, “Choi should stand before the National Assembly during a parliamentary investigation as a
witness and thoroughly clarify the people’s suspicions.”

Lawmaker Chung Sye-kyun demanded, “President Park Geun-hye needs to show determination befitting her position to eradicate such problems.”

The opposition including the New Politics Alliance for Democracy is focusing the spotlight on issues with the development of overseas resources by the Lee Myung-bak government because they deemed the “resource diplomacy” a serious problem, for it has led public enterprises to suffer investment losses and carry huge debts.

This day, Justice Party lawmaker Kim Je-nam released data from the Korea Gas Corporation titled, “Prospect of Returns on Project Investment Including the Horn River Project” and pointed out, “The Korea Gas Corporation invested 1 trillion won in three projects in Canada’s Horn River and Westcut Bank in early 2010, but they haven’t even been able to recover their investment funds.

The confirmed losses from Canada’s shale gas project have already reached 560 billion won, and operation profits for the next twenty-five years is only expected to be 190 billion won. The corporation is having a tough time dealing with the interest.”

On October 21, during a parliamentary investigation by the industry, trade, and resources committee, the copper mine project in Boleo, Mexico emerged as an issue. A consortium of the Korea Resources Corporation and a private company acquired a business on the brink of bankruptcy in 2008 and has poured in 2.3 trillion won so far.

This is a typical case of an investment gone sour. New Politics Alliance for Democracy lawmaker Boo Jwa-hyun said, “The Korea Resources Corporation paid 42 billion won which the private business partner had failed to pay, and acquired their shares.”

Lawmaker Chun Soon-ok of the same party said, “The Korea National Oil Corporation, the Korea Gas Corporation, and the Korea Resources Corporation invested more than 26 trillion won in 2008-2012 in 68 projects to develop resources, but they have received more than 10% of their investment costs from only 8 of these projects by the first half of this year.

The chairman of the party’s policy committee Baek Jae-hyun said, “The acquisition of Canada’s Harvest Operations Corp., the acquisition of Westcut Bank, and the contract with Gladstone LNG are all cases of bad acquisitions promoted by Deputy Prime Minister Choi.”