Incheon Metropolitan City Government Applies to Designate Jemulpo District's Steel Industry as a Preemptive Industrial Crisis Response Area

【Financial News, Incheon—Reporter Han Gap-su】Incheon Metropolitan City Government has formally applied to the government to designate Jemulpo District as a Preemptive Industrial Crisis Response Area to address the prolonged downturn in the steel industry.
Incheon Metropolitan City Government announced on the 21st that it had submitted an application to the Ministry of Trade and Industry to designate Jemulpo District's steel sector as a Preemptive Industrial Crisis Response Area.
The steel industry in Jemulpo District is facing mounting difficulties as a prolonged slump in the construction market, an influx of low-priced Chinese steel products, tighter U.S. steel tariffs, and rising industrial electricity rates have converged. The crisis centered on Hyundai Steel and Dongkuk Steel Mill is spreading to partner companies, the labor market, and local businesses, placing a broader burden on the regional economy.
Jemulpo District has served as a key hub for steel supply in the Seoul metropolitan area, led by Hyundai Steel and Dongkuk Steel Mill. However, its industry is heavily focused on reinforcing bars, making it particularly vulnerable to the recent downturn in the steel market. In January this year, Hyundai Steel permanently closed its electric-furnace steelmaking plant and small rolling mill and carried out a voluntary retirement program. Dongkuk Steel Mill is also pursuing self-help measures to normalize its operations, including adjustments to production and operating rates.
To respond to the crisis in the steel industry, the city activated a task force involving relevant agencies and formed a public-private consultative body with the participation of the Incheon Chamber of Commerce and Industry, Hyundai Steel, Dongkuk Steel Mill, and the Korea Institute of Industrial Technology. It prepared the application after visiting corporate sites, surveying steel companies and their partner firms, and analyzing the industry's economic ripple effects.
A Preemptive Industrial Crisis Response Area is a government program established under the Special Act on Regional Industrial Crisis Response and Regional Economic Recovery. It provides proactive government support to areas expected to experience a sharp downturn in their primary industries.
If designated, comprehensive support will be provided to companies, workers, and the regional economy for two years from the date of the announcement. Available measures include emergency management stabilization funds and policy financing, extensions of loan maturities and payment deferrals, interest subsidies, support for research and development (R&D) and business commercialization, and assistance for employment stability and career transitions.
The city plans to use the designation to support technological innovation by steel companies, their transition to environmentally friendly and high-value-added industries, the operational stability of partner firms, and the retention of jobs.
The city had previously pursued the designation of Jemulpo District as a Preemptive Employment Crisis Response Area under the jurisdiction of the Ministry of Employment and Labor, securing the designation in July. It is using KRW 4 billion in national funding to implement support programs for workers in the steel sector.
The Ministry of Trade and Industry will review the application, consult with relevant ministries, and conduct on-site inspections of steel companies in Jemulpo District. It will then refer the matter to the Industrial Crisis Response Deliberation Committee for deliberation and a decision before determining whether to grant the final designation.
Mayor Park Chan-dae said, "The steel industry is a national backbone industry that supports not only Jemulpo District but also Incheon's manufacturing sector and the industrial ecosystem of the Seoul metropolitan area. As difficulties faced by steel companies could develop into a crisis for the entire regional economy, the government needs to provide swift support."
[email protected] Han Gap-su Reporter