A power struggle between the Ministry of Trade, Industry and Energy and the Ministry of Oceans and Fisheries continues over jurisdiction in the shipbuilding industry. This is because claims have emerged that the department responsible for the shipbuilding industry should be transferred from the Ministry of Trade to the Ministry of Oceans ahead of the announcement of restructuring plans by the Lee Jae-myung administration.

The Ministry of Oceans and Fisheries argues that "the ministry must oversee to comprehensively address issues throughout the entire process of shipbuilding," while the Ministry of Trade counters that "it can formulate trade strategies in connection with upstream and downstream industries and simultaneously promote technological development." Notably, the recent resurgence of the shipbuilding cooperation project 'MASGA' in U.S.-Korea tariff negotiations has also become a variable in the controversy.

On the 3rd, the government is unveiling a red hat with the phrase 'MASGA' created for the resolution of the Korea-U.S. tariff negotiations at the presidential office in Yongsan, Seoul. /Courtesy of News1

According to the government on the 11th, Kim Jeong-gwan, the Minister of Trade, recently noted in a post on the internal network 'Neodo Na Do' that "this negotiation has become an opportunity to reaffirm our department's identity and dynamism, encompassing the three words 'industry,' 'trade,' and 'resources.'" He further stated that "not being limited to a single institutional sector, a trade strategy is established on the foundation of industrial policy, and there has been a comprehensive response considering security in energy and resources, which made the current achievement possible."

This is interpreted as an intention to accentuate the legitimacy of the current Ministry of Trade structure ahead of the Presidential Committee on Policy Planning's announcement of government restructuring plans on the 13th. It is because of the overlap between Lee Jae-myung's pledge to separate the energy sector to establish a Ministry of Climate Energy and Jeon Jae-soo, the Minister of Oceans and Fisheries, claiming that the Shipbuilding and Marine Plant Division should be transferred to his ministry.

Minister Jeon Jae-soo visits the press room after holding an inauguration ceremony at the Government Sejong Convention Center in Sejong City on the morning of July 24, and is having a meeting with the press corps. /Courtesy of News1

◇ The Ministry of Oceans and Fisheries: 'We are closer to the shipbuilding industry... the current system is inefficient'

The former minister emphasized again that the Ministry of Trade should actively consider transferring the shipbuilding and marine plant division to enhance the functions and roles of the Ministry of Oceans and Fisheries after taking office on the 24th of last month. He expressed confidence that "if the Ministry of Oceans and Fisheries takes on the shipbuilding industry, it could yield results 1,000 to 10,000 times better."

This consideration is based on the fact that the Ministry of Oceans and Fisheries is practically responsible for the entire cycle of the shipbuilding industry, including ship construction. It claims that being closer to the 'field' of shipbuilding allows for higher policy efficiency.

A Ministry of Oceans and Fisheries official said, "Shipbuilding is not just about construction; it's an industry where the entire process continues through inspection, operation, and recycling," adding that "currently, only the Ministry of Trade handles ship construction, while the rest is managed by the Ministry of Oceans and Fisheries, which makes the current structure inefficient."

The official also pointed out that the Ministry of Oceans and Fisheries is fully responsible for international responses related to ships and the maintenance of technical standards, as well as its high expertise in personnel related to shipbuilding. The ministry has a number of 'ship-related' personnel with majors such as navigation, and it also has policy functions related to international maritime organization (International Maritime Organization (IMO)) responses, ship inspections, safety management, research and development, and ship financing.

A Ministry of Oceans and Fisheries official explained, "As international standards change according to future ship trends such as eco-friendliness and autonomous navigation, the ministry will handle everything from domestic legal adjustments to business guidance reflecting these changes."

Minister Kim Jeong-kwan is reporting on the results and future plans of the Korea-U.S. tariff negotiations at the 1st plenary meeting of the Trade, Industry Energy, SMEs, and Startups Committee, held on the 6th in Yeouido National Assembly, Seoul. /Courtesy of News1

◇ The shipbuilding sector became a card in tariff cooperation… Ministry of Trade: 'Trade accomplishments are only possible under the current system'

When the former minister highlighted the necessity for transfer before and after taking office, there were considerable voices in the Ministry of Trade concerned about its realization. This was because it was expected that the former minister, who comes from a legislative background, would have greater impetus than Minister Kim, who has a bureaucratic and corporate background.

However, the atmosphere turned when the shipbuilding cooperation project introduced during this tariff negotiation received a positive response from the United States. Since shipbuilding has risen to a major agenda item in trade negotiations, it reaffirmed that it falls under the jurisdiction of the Ministry of Trade. Minister Kim appeared on MBC Radio's program 'Kim Jong-bae's Focus' on the 5th and acknowledged the contribution, saying, "We will commend the Director who provided opinions related to MASGA."

The Ministry of Trade also emphasizes that shipbuilding is a manufacturing industry closely interlinked with upstream and downstream industries such as steel, machinery, and energy. An official from the Ministry of Trade stated, "The ability to implement proactive shipbuilding policies like crisis response, technological development, and inter-industry connections has also been thanks to the current system."

They also refer to Japan's example, where the shipbuilding industry declined. It is noted that the separation of the shipbuilding industry under the Ministry of Land, Infrastructure and Transport in Japan hindered synergy with other manufacturing industries, contributing to its loss of competitiveness after having been the world leader until the 2000s. Other major shipbuilding countries such as China (Ministry of Industry and Information Technology), Finland (Ministry of Employment and Economy), and Germany (Ministry of Economic Affairs and Climate Action) also have their manufacturing ministry oversee the shipbuilding industry.

◇ Insiders and outsiders call for more urgent trade responses… Some suggest the need for a separate control tower

There is a prevailing view among insiders and outsiders that the Ministry of Trade's reasoning is more persuasive. This is because it is seen as a time to focus more on the uncertainties in the trade environment.

A government official stated, "While the Ministry of Oceans and Fisheries' position has some validity, I believe that the current system, which is intertwined with the trade sector, is more appropriate for maintaining good negotiations with the United States going forward."

Some voices suggest that rather than adjusting the jurisdiction of the main ministries, there is a need for a control tower related to shipbuilding that transcends barriers between government departments within the current system.

Yang Jong-seo, chief researcher at The Export-Import Bank of Korea's Overseas Economic Research Institute, stated, "The United States also has a maritime security advisor; if Korea were to establish a control tower for the two departments under the presidential office, it would be able to finely tune policies."

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