S. Korean gov’t pushes for reform in petrochemicals industry

[THE INVESTOR] The government on Sept. 28 called for a restructuring of the petrochemicals industry to reduce oversupply and streamline businesses.

“According to a consultation report, a rapid business restructuring should be implemented with regards to four of the 33 key (petrochemicals) products are in oversupply,” Minister of Trade, Industry and Energy Joo Hyung-hwan said at a meeting with chiefs of petrochemical companies.

“It is important that (concerned businesses) shed unnecessary weight through preemptive restructuring.” 

The report was drawn up by Bain & Company, and this is the first time the government has cited a private sector report in calling for restructuring measures.

The four products considered to be in oversupply are terephthalic acid, polystyrene, synthetic rubbers and PVC. In total 11 companies including LG Chem, Lotte Chemical and Hanwha Chemical are currently producing the concerned products.

By Choi He-suk (cheesuk@heraldcorp.com)