Critical nuclear falloutsDoosan Heavy Industries & Construction CEO Kim Myung-woo has offered to resign after serving nine months in office, citing deteriorated performance that calls for stringent streamlining in business and payroll. The company specializing in nuclear reactor equipment has cut executives by 30 percent and sent 400 employees to affiliated companies. The company’s poor performance owes to reduced demand overseas and at home in the wake of the government’s policy to phase out nuclear reactors.
Doosan Heavy Industries is the nation’s sole provider of turbines, generator and steam pipes that go into power reactors. It was involved in developing the indigenous Korean nuclear reactor model that was exported to the United Arab Emirates. It was hit hard after the Moon administration announced an outline to abandon nuclear fuel and canceled multiple reactor construction projects. Its last project at home will be the Shin Kori 5 and 6 reactors that will be completed in 2021. The company has already spent 493 billion won ($438 million) on Shin Hanul 3, four reactors whose construction was called off. The company is not sure if it can redeem its early construction costs. The city of Changwon, where Doosan Heavy and its supply chain are based, fears the impact on the regional economy. Despite being dominated by ruling party members, the city council passed a petition to the central government demanding a reversal of the nuclear reactor phase-out policy.
A phase-out would not just damage one major company, but bring down the entire industrial habitat in one of the few technologies Korea excels at in the world. Since the announcement, about 90 key component makers lost 40 percent of their trained engineers. Students enrollment in nuclear engineering departments fell sharply and brains in the field have already left for jobs overseas. The hard-built research and development capabilities are coming down.
The government claims the technology can be saved by exporting it overseas. But who would buy technology that is shunned at home? A Gallup Korea poll showed that those wishing for an increase, or at least the maintenance, of the status quo in reactor power generation was more than double that supporting reactor reduction. The government chooses not to see the damages. Its stubborn ideology-led policy is hurting companies and making people anxious.
JoongAng Ilbo, Dec. 13, Page 34