Conflict reignites over location of POSCO's R&D center

POSCO N.EX.T Hub's logo is seen at the R&D facility's headquarters inside the Research Institute of Industrial Science & Technology in Pohang, North Gyeongsang Province, in this undated photo. Yonhap

POSCO Group's decision to name a new R&D center branch in Gyeonggi Province the "Global Center" has reignited tensions with residents of Pohang, where the steelmaker's headquarters is located.

The steelmaker has long been at odds with Pohang’s residents and policymakers, especially when the company hints at shifting its R&D or headquarters functions closer to the capital. The renaming of the new R&D branch as the "Global Center" has stirred concerns in Pohang, with locals fearing that the title reflects POSCO's intent to prioritize the Gyeonggi branch over POSCO N.EX.T Hub located in the southeastern port city. This move has irked Pohang residents, who see it as diminishing the city’s role within the steelmaker’s operations.

"According to a recent news article, POSCO Group Chairman Chang In-hwa instructed that the new branch be named 'POSCO N.EX.T Global Center' instead of being labeled a branch," Pohang-based civic group, Fixing POSCO, said in a statement earlier this week.

"If these reports are true, we will not hesitate to fight back strongly. The research institute's headquarters must be located in Pohang and transfer all its core activities to Pohang."

The conflict over the R&D facility is in line with years of disputes between the group, Pohang residents and local politicians, who have been suspecting that the group is seeking to relocate its core functions to the capital area, leaving behind its steel mills in the city.

POSCO Group initially sought to open N.EX.T Hub in the capital area, but ended up scrapping the plan, opening it in Pohang in April last year. However, the group decided to open a branch of the facility in Seongnam, Gyeonggi Province, late last year, rekindling conflicts with residents.

Amid alleged irregularities involving former POSCO Chairman Choi Jeong-woo and severe backlash from Pohang's residents, POSCO Group canceled a groundbreaking ceremony for N.EX.T Hub's branch earlier this year, but a news outlet recently claimed that the current chairman wants the branch to be called the Global Center.

The residents have condemned POSCO Group's plan to invest more heavily in the new branch than in the headquarters.

"With the 2.5 trillion won ($1.8 billion) to be invested in Seongnam, POSCO can provide researchers with the best residential conditions, cultural facilities, years of salaries and research equipment," the civic group said.

"Considering that POSCO cited its poor performance as the reason for its withdrawal of large-scale investments in Pohang, it should reconsider the establishment of N.EX.T Hub's branch in Seongnam," the civic group added.

Despite the opposition, POSCO Group has moved forward with the opening of the Global Center.

The company clarified that the plan aims to strengthen its research capabilities, emphasizing that the Global Center will serve as a hub, connecting POSCO Group’s R&D facilities in Pohang, Incheon, and Gwangyang, South Jeolla Province, with international research institutions.

The steelmaking group relocated POSCO Holdings launched in 2022 to Pohang from Seoul, after facing protests from the port city's residents who complained about the holding firm's employees staying at the Seoul office.