The North Korea-based telephone-service joint venture of the Loxley Plc group is likely to be affected by the sanctions imposed by the United Nations Security Council against North Korea over its nuclear test early this month.

Loxley's executive vice president Jingjai Hanchanlash said the sanctions were likely to affect the company's fixed-line business in the Rason economic zone as foreign companies would be discouraged from setting up businesses in the area.

Loxley joint venture North East Asia Telephone and Telecom-munication has provided a fixed-line service to companies in the zone for 10 years now under a 30-year contract.

It has already spent US$18 million (Bt672 million) on business development and has around 10,000 customers.

Jingjai said Loxley had 20 per cent in the joint venture, while the Finish and Taiwanese partners own the remaining stakes. "We still hope that the situation will get better soon," said Jingjai, who is also the joint venture's chairman.

Early this month Thailand's Foreign Ministry said in a statement that the country would abide by sanctions imposed by the UN Security Council on North Korea.

The joint venture also offered mobile-phone services in the same zone before the North Korean government ordered their suspension, citing national security concerns. The company later pulled out of the mobile-phone business to focus on the fixed-line service.

Loxley was the only Thai telecom firm exploring business opportunities in North Korea 10 years ago while other companies were moving into countries neighbouring Thailand. Many later pulled out of foreign markets after Thailand's economic crisis in 1997.

Usanee Mongkolporn

The Nation