Ministry of Trade Industry and Resources

All 16 petrochemical companies operating Naphtha Cracking Centers (NCCs) and Propane Dehydrogenation (PDH) facilities across three petrochemical complexes in Yeosu, Daesan, and Ulsan submitted their draft business restructuring plans by December 19, in line with the end-December deadline set out in the government’s roadmap to revitalize the petrochemical industry announced in August. 

Following the completion of the first phase of structural reform, the Ministry of Trade, Industry and Resources (MOTIR, Minister JK Kim) chaired a meeting with the petrochemical industry at the Korea Chamber of Commerce and Industry in Seoul on December 22.

The meeting was convened to gather industry feedback on the submitted restructuring plans and to encourage their prompt implementation.

Minister JK (Jung-Kwan) Kim stated, “The timely submission of restructuring plans by all companies puts the industry on track to meet its voluntary capacity reduction target of 2.7 to 3.7 million tons, provided the plans are fully implemented.” He emphasized that “structural reform must move forward at a faster pace starting next year to deliver tangible results” and urged companies to “promptly establish their final business restructuring plans based on the drafts.”

Once companies submit their final plans, MOTIR will review them for approval through a dedicated Business Restructuring Review Committee. Upon approval, the ministry will announce a comprehensive support package—covering finance, tax incentives, R&D, and regulatory easing—to support implementation.

To support the shift toward higher value-added production, the Chemical Industry Innovation Alliance will be launched on December 23. The Alliance will bring together all key stakeholders across the chemical industry ecosystem—including demand-anchor companies, small and medium-sized chemical firms, academia, and research institutions—and serve as a collaborative platform to explore R&D programs and infrastructure support measures for core materials, with a view to advancing the industry’s main sectors and accelerating its transition toward more environmentally sustainable production. In advancing such R&D efforts, the government will give priority to the R&D needs of companies participating in the restructuring.

The meeting also discussed the “Daesan Project No. 1,” for which HD and Lotte applied for restructuring approval on November 26. The project is currently undergoing preliminary review, with approval targeted for January next year, while the government’s support package has entered its final review stage. Creditor financial institutions are also working to coordinate and finalize financial support measures based on ongoing due diligence.

Minister Kim assessed that “despite a tight schedule, all companies had submitted their draft restructuring plans by the end-December deadline set at the August ministerial meeting on strengthening industrial competitiveness, marking a solid start to structural reform.” He added that “while this year focused on laying the strategic groundwork for reform, next year will be decisive in determining its success through execution,” and stressed that “the government and industry will work together as one team toward the successful restructuring of the petrochemical sector.”

Minister Kim also emphasized that “the government will pay close attention to potential challenges affecting regional SMEs and employment during the restructuring process,” and said that “a comprehensive support plan for the chemical industry ecosystem will be announced in the first half of next year.”