28 Out of 103 Sites Nationwide Resume Operations
Normalization Underway for Otier Banpo and Seoripul Complex in Seocho
President's "License Revocation" Remarks Subside, Ministry Says "Difficult Under Current Law"
Challenges Remain, Including Subcontractor Payments and Delayed Occupancy
POSCO E&C, which had halted work at 103 construction sites nationwide, began gradually resuming construction at some sites starting on the 21st. After a series of safety accidents, all projects had been suspended since the 4th, but after about three weeks, some have now resumed. The risk of license revocation, which had been a major concern, has also virtually disappeared, providing some relief. However, analysts say there is still a long way to go before full normalization is achieved.
On the 21st, POSCO E&C announced that it would resume construction at 21 residential and 7 infrastructure sites directly related to public life, in order of safety verification. The company explained that it decided whether to restart work at each site after a five-step verification process, which included inspections by external experts, confirmation of corrective actions, and approval from the Chief Safety Officer (CSO). POSCO E&C stated, "At major infrastructure sites like the Incheon Third Link Bridge, unconstructed sections can actually increase the risk of deformation and sagging," adding, "We are taking prompt action at sites where public inconvenience is significant or safety risks are rising."
The situation, which had escalated to the point of industry exit risks when President Lee Jaemyung mentioned the possibility of license revocation by questioning whether the incidents amounted to "murder by willful negligence," has recently calmed down. Recently, Minister of Land, Infrastructure and Transport Kim Yoonduk stated, "It is difficult to revoke licenses under current laws," stepping back from the previous stance. The construction industry has expressed concerns that indiscriminate license revocations could shrink the entire sector.
With construction resuming, sales schedules for metropolitan area complexes, such as 'Otier Banpo (post-sale)' in Seocho-gu, which is about 90% complete, are also expected to be rescheduled. Otier Banpo was originally slated for occupancy in October, but there had been growing concerns that the timeline would be delayed due to the suspension. The redevelopment project at Seoripul in Seocho-gu (the former site of the Army Intelligence Command), which had stopped at an early stage, is also expected to be normalized. This site is the largest in Korea in terms of project financing (PF), with approximately 5.3 trillion won invested.
While some relief has been achieved, challenges remain. Of the 103 sites, only 28 have resumed operations so far. The remaining 75 sites must still undergo inspections by external experts and receive CSO approval. POSCO E&C stated, "We plan to re-inspect all sites and conduct additional detailed checks for high-risk processes." The company also needs to address issues such as delayed occupancy and unpaid subcontractor fees that arose during the suspension period.
Industry insiders believe that, having overcome short-term risks, POSCO E&C must now focus on regaining trust. The brand image of The Sharp and Otier has been damaged, and the company still faces challenges such as sluggish overseas orders and an operating loss of around 91 billion won in the second quarter. A construction industry official said, "While the resumption of work is welcome, the key going forward is to ensure that safety management is not just a formality but becomes an established system at worksites."
© The Asia Business Daily(www.asiae.co.kr). All rights reserved.
