Deputy Prime Minister and Minister of Economy and Finance Koo Yun-cheol said, "The petrochemical companies and major shareholders should prepare a plan to strengthen competitiveness with bone-cutting self-rescue efforts."
On the 20th, Deputy Prime Minister Koo emphasized to the petrochemical industry during a ministerial meeting on enhancing industrial competitiveness held at the Government Seoul Office, saying, "Please present your business reorganization and competitiveness enhancement plans with a sense of urgency, even if it means submitting them next month."
He criticized, "Domestic petrochemical firms have been ignoring the issues until now," and pointed out, "Despite warnings of oversupply from China and the Middle East, the domestic petrochemical industry has instead increased its facilities, intoxicated by past booms, and has faced significant difficulties by failing to shift to high-value-added products."
On this day, 10 major petrochemical corporations held an autonomous agreement ceremony for industry business reorganization and agreed to ▲ reduce naphtha cracking facilities (NCC) by 2.7 million to 3.7 million tons ▲ transition to high-value-added eco-friendly products ▲ minimize the impacts on the regional and national economy. Additionally, they agreed to prepare business reorganization plans that include facility reductions and financial structure improvements by the end of the year.
Deputy Prime Minister Koo called this agreement "just taking the first step" and emphasized, "There is still a long way to go." He continued, "With a complacent mindset of 'Just endure' or 'Just avoid the downpour,' it is impossible to overcome the crisis," urging them to approach it with the determination of "to live or die."
The government plans to present support measures in line with the industry's commitment to business reorganization with bone-cutting determination. The Ministry of Trade, Industry and Energy will maintain close communication with corporations and major shareholders to ensure that self-rescue efforts are reflected in the reorganization plans, and the Financial Services Commission will monitor the financial conditions and self-rescue efforts in conjunction with bond financial institutions.
Deputy Prime Minister Koo warned, "If the plans submitted by the industry are deemed sincere, we will timely support comprehensive measures such as deregulation, finance, and tax. Corporations that delay business reorganization or attempt to free-ride will be excluded from government support."
He also added, "The shipbuilding industry has made a comeback as the world's number one through bone-cutting restructuring and has made significant contributions in the Korea-U.S. tariff negotiations," stating, "If the petrochemical industry follows the example of shipbuilding, it can also make a comeback, even if it's painful."
The government plans to hold the ministerial meetings on enhancing industrial competitiveness regularly in the future to check the progress of business restructuring efforts and to implement necessary measures in a timely manner.