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some form of regional dialogue on security issues, although it would still take some time for consensus to emerge on format and the reservations of China still had to be overcome.
5.
On the North-South dialogue the consensus was that no progress would be possible until mid-April/early May. The North Korean economy was in a bad state, but not so bad as to force the North Koreans into early concessions on the nuclear issue. Nor, conversely, were the South Koreans under irresistible pressure from commercial interests to free up economic links. It was not excluded that the South Koreans might in due course offer some slight modification of their position on bilateral nuclear inspections to get talks moving again.
6.
The internal scene is of course in a period of transition to the Presidency of Kim Young-sam, and I encountered more questions than answers. Key questions seemed to be:
7.
will Kim be able to display the qualities of leadership, and find himself advisers of the calibre, which will be needed if the economic, social and political challenges of the immediate future are to be properly tackled? Mr Wright detects growing doubts on that score;
how will the old guard, and in particular the military, react if the going gets rough and, for example, popular protest at economic hardship breaks out?
will Kim be able to establish good personal
relations with President Clinton and take the edge off his protectionist instincts?
My contacts with British businessmen brought home to me that Korea is not any easy place to do business. There was much talk of the anti-import culture and bureaucratic obstructionism that act as brakes on investment and trade. I understand that a recent study carried out at the French business school INSEAD concluded that Korea was the least attractive destination for foreign investment in the Far East. But the Embassy still sees scope for greater efforts by British industry, and is pursuing this with the DTI.
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