South Korean Deputy Prime Minister Choi Sang-mok, along with the Minister of Oceans and Fisheries, the First Vice Minister of Trade, Industry, and Energy visited POSCO’s Pohang Steelworks on 17 October to discuss measures for boosting investment and toured around the proposed site for hydrogen-based steelmaking and the operations at the Nº2 steelmaking plant.

To date, the government has supported the rapid execution of investment projects totaling 93 trillion (US$68 billion) won through two rounds of investment promotion measures (November 2023 and March 2024). In particular, for POSCO Pohang Steelworks’ 20 trillion won (US$14.6 billion) hydrogen-based steelmaking project, the government has shortened administrative procedures by a total of 11 months, including exempting the maritime traffic safety diagnosis (cut by 6 months), expediting the environmental impact assessment (cut by 2 months), and fast-tracking the landfill master plan integration process (cut by 3 months). As a result, the groundbreaking is now expected to be advanced to June 2025.

Upon completion of the project in 2050, including POSCO’s Gwangyang hydrogen-based steelmaking project, a total investment effect of 40 trillion won (US$29.2 billion) is forecasted, along with the achievement of carbon neutrality in the steel industry through hydrogen-based steelmaking technology.

The government will provide full support for these corporate efforts toward carbon neutrality. As a catalyst for promoting private-sector eco-friendly investments, green finance will be expanded (6 trillion won in 2024 → 9 trillion won in 2025), and financial support for R&D in core carbon-neutral technologies will continue to be increased (2 trillion won in 2024 → 2.2 trillion won in 2025).

In addition, with an aim to allow companies regulated by the emissions trading system to manage their allowances more flexibly, institutional improvements for easing the carryover restrictions and enhancing volatility management systems will be pursued.

The government also plans to thoroughly support the development of new technologies and the stabilization of supply chains. Tax support for corporate investments will be strengthened by increasing the deduction rate for investment growth (3-4% → 10%) and extending the temporary investment tax credit. The sunset clause for tax credits related to national strategic technologies will also be extended to ensure continued support. Hydrogen-based steelmaking technology pioneered by POSCO was designated as a national strategic technology in February 2024.

Support for advanced industry infrastructure will be reinforced, including an increase in the budget for supporting specialized secondary battery clusters from 19.1 billion won (US$14 million) in 2024 to 25.2 billion won (US$18.4 million) in 2025. To be specific, the Pohang secondary battery industrial complex has been provided with 15.4 billion won this year to build water supply facilities at the Yeongilman general industrial complex. In 2025, an additional 7.2 billion won will be allocated to construct underground brine discharge pipelines at the Pohang Blue Valley National Industrial Complex.

The government plans to expand investments related to supply chains stability, such as securing stable raw materials, through the Supply Chain Stabilization Fund, which was launched on 5 September. In particular, four POSCO Group companies involved in secondary battery materials were selected as leading businesses in August of this year. They will receive additional support, including preferential interest rates, for their investments aimed at stabilizing the supply chain.