Dangjin, South Chungcheong Province, has applied to the government for designation as an "industrial crisis preemptive response zone" to address the downturn in the steel industry.
According to the Ministry of Trade, Industry and Resources on the 15th, Dangjin submitted its application for designation as an industrial crisis preemptive response zone to the Ministry of Trade and Industry (MOTI) on the 13th.
The industrial crisis preemptive response zone is a system introduced for the government to provide early support when a regional industrial downturn is expected or a structural crisis is a concern. Once designated, the region can receive various forms of government assistance, including financial and employment support and management consulting.
After the government designated Yeosu, South Jeolla Province, as the first industrial crisis preemptive response zone in May last year, it went on to designate Seosan (petrochemicals) in South Chungcheong, Pohang (steel) in North Gyeongsang, and Gwangyang (steel) in South Jeolla. Ulsan, which has a petrochemical industrial complex, also recently submitted a related application to the Ministry of Trade and Industry (MOTI).
The government is expanding support areas around steel and petrochemical industrial complexes because the slump in these industries is spreading across the broader regional economy.
According to South Chungcheong Province, the manufacturing output of Dangjin, where the Hyundai Steel general industrial complex and the Dangjin 1 Steel general industrial complex are located, is about 31.2 trillion won, with the steel industry accounting for about 60% (about 18.7 trillion won). About 40% of the roughly 35,800 manufacturing workers in the Dangjin area are also employed in the steel industry.
However, the worsening steel market is also affecting the regional economy. While major steel corporations in Dangjin posted a deficit of about 66 billion won in the first half of last year, Dangjin's local corporate income tax fell sharply from 31.7 billion won in 2022 to 2.8 billion won in 2024.
The Ministry of Trade and Industry (MOTI) plans to comprehensively review local industrial conditions and the degree of crisis based on the application and then decide whether to grant the designation.