Government Denies Petrochemical Sector’s Request to Relax Antitrust Regulations
The petrochemical industry in Korea has faced tough times recently, with strong competition from Chinese rivals and challenges posed by the global economic downturn. In response, the government has introduced new measures to help boost the industry’s competitiveness.
These measures include allowing petrochemical firms to defer the payment of transfer income taxes when selling assets in regions vulnerable to industrial decline. This will help companies repay debts or make much-needed investments. Subcontractors and small business owners in these regions will also receive financial support from the government.
In addition, the government will inject up to 3 trillion won ($2 billion) in state-financed funds into the petrochemical sector, providing companies with liquidity and offering low-interest loans to help them reorganize their businesses. The aim is to support companies facing challenges in the industry.
While the measures did not include a relaxation of antitrust regulations, which some had hoped for to facilitate mergers and acquisitions within the industry, the government will help companies navigate the process of joint ventures and M&A deals to streamline the review process.
The Korea Chemical Industry Association (KCIA) welcomed the government’s plans, but some industry officials remain cautious, noting that the measures may not be enough to address the industry’s ongoing challenges. The government has pledged to listen to feedback from the industry and announce additional measures in the coming months.
Overall, the goal is to support the petrochemical industry in Korea during a challenging time, providing much-needed assistance to companies as they navigate a rapidly changing economic landscape.
