Petrochemical Industry Urges Lee's Camp for Facility Investment Tax Credits... Policy Proposals Made in Ulsan

Petrochemical Industry Shifting from General-purpose to High Value-added Products
Policy Meeting Chaired by Democratic Party's Ahn Dogeol
Industry Proposes Designating Industrial Crisis Response Areas and Reducing Electricity Costs

The petrochemical industry, centered around the Ulsan Petrochemical Industrial Complex, has directly appealed to the political sphere about the burdens it is facing during the process of structural transformation. Companies have cited the burden of production costs, shrinking investments, and various regulations, expressing the need for institutional support. With the presidential election approaching, politicians are also actively working to develop related policies through on-site visits and meetings.

According to the industry on May 16, a policy meeting was held the previous day at the SK Geocentric Ulsan Complex (CLX) in Nam-gu, Ulsan, chaired by the "Committee for Revitalizing Industrial Crisis Areas" under the election campaign committee of Lee Jaemyung, the Democratic Party's presidential candidate. The meeting was organized as Committee Chairperson Ahn Dogeol stated, "Policy alternatives come from the field," expressing his intention to listen directly to voices from the industrial sector. Major petrochemical companies such as SK Geocentric, Korea Petrochemical Ind., Hyosung Chemical, and SK Gas, as well as representatives from the Korea Chemical Industry Council, attended the meeting.

The industry proposed several support measures: designating Ulsan as an industrial crisis response area, expanding tax credits for the development of eco-friendly materials and high-performance products, and reducing electricity costs through the designation of special zones for distributed energy. Recently, there has been a consensus within the petrochemical industry on the need to shift from a structure focused on low value-added, general-purpose products to one centered on high value-added products, and companies are engaging in related research and development (R&D). However, the industry has responded that, in practice, the transition is slow due to the burden of initial investment costs and a lack of incentives.

The political sphere has also stated its intention to reflect these industrial requests in policy development during the presidential election period. In a phone interview, Representative Ahn said, "The petrochemical industry is a core industry that supports local jobs and makes a significant contribution to national exports," and added, "Regardless of any change in administration, I will work to establish effective systems so that the Ministry of Trade, Industry and Energy can continue its structural reform policies."

Representative Ahn also plans to visit Yeongam, South Jeolla Province, a shipbuilding site, on May 19 to gather additional opinions related to industrial crisis areas.

This meeting is interpreted as part of efforts to connect on-the-ground difficulties to policy, amid the trend of petrochemical industry restructuring that has been in full swing since last year. The industry emphasizes that for structural transformation to become a reality, comprehensive improvements in areas such as taxation, infrastructure, and regulation must proceed in parallel.