Hyundai head remanded in custody, Czech Rep awaits news from South Korean carmaker

The arrest of the head of the carmaker Hyundai in South Korea has raised questions over the future of a major investment deal in the Czech Republic. Earlier, before the arrestm, Czech Prime Minister Jiri Paroubek had said that he would be prepared to go to South Korea to seal an agreement with Hyundai on its first European car plant in the Czech Republic but the escalating corruption scandal in South Korea could have unforeseen consequences, with Hyundai's boss remanded in custody.If the Czech prime minister or the minister for trade and industry do fly to Seoul to finalise an agreement on the billion dollar Czech car plant, they will now presumably deal with Kim Tong-Chin. He will be taking over Hyundai in the interim. The Czech government has not received offiicial word from Hyundai yet.

The Czech prime minister and others have been intent on quelling fears that the corruption scandal could cause the cancellation of the Czech project. The launch ceremony for the Czech plant at Nosovice, in the east of the country, was originally scheduled for May 17th. A top Hyundai executive has suggested that the investment in the Czech Republic could be postponed indefinitely. The Czech plant - expected to provide 3,000 direct and 10,000 indirect jobs - was due to start production in 2008.