“Unification Costs Damage Korea’s Credit Rating: S&P,” by Bang Hyeon-chol, Digital Chosunilbo, http://english.chosun.com/w21data/html/news/200501/200501130015.html, 13 January 2005 (from One Free Korea).

“Former U.S. Envoy Warns Seoul Against Supporting Pyongyang,” by Bae Seong-gyu, Digital Chosunilbo, http://english.chosun.com/w21data/html/news/200501/200501130026.html, 13 January 2005.

When North Korea falls, what then?

The Kims have so destroyed their country that it would cost a lot for South Korea to absorb it…

The international credit rating agency Standard & Poor’s (S&P) said Thursday the risk posed to South Korea by the North was greater than that posed to Taiwan by China.

In a conference call with S&P about a report titled “Political and Contingent Risks: Analyzing the Credit Risks of Taiwan and South Korea,” the firm cited that as the reason Korea was given a currency credit rating of A+, one level lower than Taiwan’s AA-.

S&P said that while economic development in Korea and Taiwan is of a similar standard, the difference in credit rating was primarily due to the fact that North Korea posed a greater risk than China, based on the cost of unification South Korea would have to bear.

S&P said North Korea’s economy was stagnant and its infrastructure crumbling, and unlike Taiwan, potential unification costs could total between 40 and 300 percent of South Korea’s annual GDP, adversely affecting the country’s credit rating

But maybe someone will take it off their hands

He also said that while most people expected the two Koreas to reunify if the North collapsed, it was more likely North Korea would be absorbed by China. Pritchard said that since North Korea already depends on China for much of its fuel and life necessities, its absorption by Beijing would be a relatively simple matter.