In the bidding process for the Gadeokdo New Airport site development project, political circles have argued that Hyundai Engineering & Construction should be held accountable for delaying this national project and that responsibility and fault must be determined. Voices are being raised, particularly among political and government figures and National Assembly members from the Busan and Gyeongnam regions. The government is currently reviewing relevant regulations to determine whether punishment is possible and, if so, at what level it should be set.
On the 25th, at the plenary meeting of the National Assembly Land, Infrastructure and Transport Committee, Minister of Land, Infrastructure and Transport Sangwoo Park stated, "We have been pushing ahead with the Gadeokdo New Airport project with determination, but I deeply regret that, as a result, the opening has been delayed by more than a year." He added, "We are closely examining with other ministries whether Hyundai Engineering & Construction qualifies as an unscrupulous contractor under the Act on Contracts to Which the State Is a Party."
Sangwoo Park, Minister of Land, Infrastructure and Transport, is giving a proposal explanation about the 2nd supplementary budget for 2025 at the plenary meeting of the National Assembly Land, Infrastructure and Transport Committee on the 25th. Photo by Yonhap News
This was in response to a request from Kim Doeup, a People Power Party lawmaker whose constituency includes Gangseo-gu, Busan, where Gadeokdo is located. Kim argued that Hyundai Engineering & Construction, after being selected as the eligible contractor for detailed design, ultimately did not participate in the project and should be penalized for this. He said, "The Ministry of Land, Infrastructure and Transport initially determined the construction period after conducting 42 foundational drilling investigations around the construction site, but Hyundai Engineering & Construction did not conduct even one investigation, extended the construction period to 108 months, and ultimately the negotiated contract was canceled. This irresponsible behavior deserves a penalty."
Min Hongcheol, a Democratic Party of Korea lawmaker whose constituency is nearby Gimhae, expressed a similar opinion. He stated, "There are expectations that the requirements will be eased in the event of a re-bid, but in that case, there is a high possibility that the construction period or budget will increase significantly. Hyundai Engineering & Construction should be held responsible for causing such disruption to a national project."
According to the penalty provisions of the Act on Contracts to Which the State Is a Party, it is still unclear whether Hyundai Engineering & Construction can be deemed an unscrupulous contractor in this case. The relevant clause defines unscrupulous contractors as those who "perform contracts poorly, shoddily, or unjustly," or "cause damage to the state through fraud or other acts during the bidding, awarding, or execution of contracts." If this clause is applied, the company could be barred from participating in bids for up to two years, effectively blocking its participation in government construction projects.
There is also a clause requiring liquidated damages for delay if contractual obligations are not met. In such cases, the amount is calculated based on a certain percentage (0.05%) of the contract amount and the number of days delayed. The contract amount is calculated by year, not as a lump sum. Since Hyundai Engineering & Construction did not sign the main contract for this project, it is unclear whether this clause can be applied. The Ministry of Land, Infrastructure and Transport has allocated approximately 604.1 billion won for the Gadeokdo New Airport site development project this year alone.
During the presidential campaign, President Jaemyung Lee pledged to review the Gadeokdo New Airport project process, identify problems, and ensure the project proceeds swiftly. Maeng Sungkyu, chairman of the Land, Infrastructure and Transport Committee, said, "With the new administration soon to be formed and ministers and vice ministers to be appointed, I hope thorough preparations are made so that there are no setbacks in enhancing national competitiveness."
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