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KDB chairman vows to support inclusive, productive growth
Korea Development Bank (KDB) Chairman Park Sang-jin speaks during a press conference at the bank headquarters on Yeouido, Seoul, Wednesday. Courtesy of KDB
By Lee Kyung-min
State-run policy bank will help unified HD Hyundai Chem for orderly restructuring of petrochem industry
Korea Development Bank (KDB) will spend 30 trillion won ($20 billion) this year for productive and inclusive growth of Korea’s high-tech industries and regional economies, the company head said Wednesday.
KDB Chairman Park Sang-jin said the drive can be advanced by the potential launch of a state-run investment entity in the southeastern region, upon the passage of related bills at the National Assembly, further helping the country move away from a Seoul-centric growth model toward more balanced, sustainable growth.
The head of the state-run policy lender also expressed hope for an orderly restructuring of HD Hyundai Chemical, a newly unified body between Lotte Chemical and HD Hyundai Chemical.
This can be a test case for effective and efficient government-led reform of many traditional, growth-driving manufacturing industries under pressure for downsizing and outright closures, in the face of new global supply-and-demand dynamics.
“We will mobilize our utmost efforts to provide 30 trillion won in financial aid packages before the year’s end,” Park said during a press conference at KDB headquarters in Seoul's financial district of Yeouido.
“We will hold seminars and information sessions in non-Seoul regions to help regional small and medium-sized businesses access government financial assistance," Park said.
Apart from the 30 trillion won earmarked as part of the Lee Jae Myung administration’s “National Growth” initiative, the state-run lender will spend 100 trillion won to strengthen the competitiveness of high-tech industries.
About 75 trillion won will be spent to extend financial support for businesses in non-Seoul areas to seek balanced growth.
Some 50 trillion won will be spent to further advance highly competitive industries, while about 25 trillion won in lending and investment will be extended for the Lee administration’s national growth drive.
As for HD Hyundai Chem, Park said the committee of creditors would meet at 3 p.m. to discuss funding support for the newly unified entity.
Providing new liquidity will inevitably increase the burden on financial institutions. However, the KDB-led creditors plan to cooperate he added.
“We plan to stress that the petrochemical industry is a core sector that underpins a wide range of other smaller industries. If they weaken, the remaining smaller players will experience major difficulties. Their recovery is critical to overall industrial stability. A successful turnaround of the integrated HD Hyundai Chemical entity would ultimately benefit the broader Korean economy," the chairman said.
Earlier in the day, the industry ministry approved a spinoff of Lotte Chemical for it to merge with HD Hyundai Chemical.
The new entity will shift toward higher value-added products, including high-elasticity plastics, secondary battery materials and eco-friendly products.