Economic Impact of 1.8 Trillion Won if HMM Builds New Headquarters in Busan

[Financial News] The relocation of HMM's headquarters to Busan, a major shipping company, is expected to have a significant economic impact by channeling the flow of capital into the local economy, as well as being an important opportunity to restore Busan's identity and competitiveness as a hub city for shipping and logistics. 
Busan Chamber of Commerce and Industry announced on the 14th that the relocation of HMM's headquarters to Busan, a presidential pledge project, has a significant economic impact on the local economy, and proposed an attraction strategy based on this analysis in the 'Economic Impact and Attraction Strategy of HMM Headquarters' report.
The report evaluated that HMM has a total production inducement effect of 11.2 trillion won, a value-added inducement effect of 4.4 trillion won, and an employment inducement effect of 21,300 people over five years.
In Busan, it is analyzed to have direct and indirect inducement effects equivalent to 7.6 trillion won in production, 2.9 trillion won in value-added, and 16,000 people in employment.
The economic impact of constructing the HMM headquarters building is also expected to be significant. Assuming the construction of a 50-story intelligent building, it is estimated that there will be an economic impact of over 1.8 trillion won, including a short-term production inducement effect of 1.3 trillion won, a value-added inducement of 517.9 billion won, and an employment inducement effect of 4,570 people.
In addition, qualitative effects such as the activation of related industries and shipping clusters, job creation and the influx of talented individuals, strengthening Busan's status as a global innovation hub for shipping logistics, promoting marine industry infrastructure and related innovation ecosystems, and balanced national development are also expected. 
Busan Chamber of Commerce and Industry raised the need for the enactment of a 'Special Act on the Creation and Development of Global Shipping Cities' as an institutional support foundation for attracting shipping conglomerates like HMM through the development cases of global shipping port cities such as Singapore, Rotterdam, and Shanghai. It aims to concretize various supports such as administrative special cases, tax benefits, relocation costs, and research and development (R&D) support, as well as a special marine financial support program that can grow Busan into a central city for shipping logistics, and to include the basis for the establishment of a maritime court.
It also suggested methods to persuade the land union, which is voicing opposition to the relocation. It proposed specific response strategies to enhance the acceptance of relocation by target employees through pre-communication and regular consultative body formation, allowing for a choice of settlement support and welfare expansion that enables concurrent base work or remote work for a certain period, and the conclusion of a win-win agreement between the government, companies, and unions, utilizing internal communication. 
Additionally, it suggested the need to form an 'HMM Busan Attraction Promotion Team' in the form of integrated governance involving all stakeholders, including the government, corporate labor, Busan City, local political circles, Busan Chamber of Commerce and Industry, and policy financial institutions. 
Yang Jaesaeng, Chairman of Busan Chamber of Commerce and Industry, said, "In a situation where 7 out of the top 10 global shipping companies have their headquarters in marine cities, the relocation of HMM's headquarters, ranked 8th globally, to Busan will be an opportunity to change the landscape of the domestic and international shipping industry," and "The local business community will also fully support Busan Chamber of Commerce and Industry." 


bsk730@fnnews.com Byungseok Kwon