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French under fire from Korea

01 Mar 1997

A BITTER row has erupted between France and South Korea that could see the 431 km Seoul - Pusan TGV line delayed by more than the four years already likely because of problems with civil engineering work (RG 12.96 p777). The problem stems from a decision last December by France's privatisation commission not to permit the sale of the Thomson Multimedia group to Korea's Daewoo Electronics.

The Koreans took it badly, demanding renegotiation of contracts with French suppliers - such as the deal which sees GEC Alsthom and its partners building prototype trains and providing know-how for Korean companies to build their own TGVs (RG 11.96 p735). French emissaries travelled to Seoul to try and smooth things over, but they returned empty-handed. Worse, the Koreans accused the French of 'yellow racism', with President Kim Young Sam saying that France could not be trusted to keep its word.

The French have not exactly handled the situation with aplomb. It seems that the Thomson-Daewoo deal was announced before the privatisation commission had given its ruling, and attempts to explain to the Koreans that the commission was an independent body met with incomprehension. Calling off the deal was seen as revenge for Korea's previous cancellation of air defence contracts in favour of American companies that had allegedly offered hefty bribes to the then President Roh Tae Woo, now serving a gaol sentence for corruption.

The freak cold weather in France in early January that immobilised TGVs for hours (RG 2.97 p82) prompted the Koreans to set up a formal investigation to see if TGVs suffered from 'critical defects'. They also took the opportunity to suggest that the Seoul - Pusan TGV contract be renegotiated. This may turn out to be cover for further problems with the civil engineering work - there are indications that the 300 km/h line may not be ready until 2010. o