PM Lee to discuss ways to revive economy in Gunsan

SEOUL, Feb. 24 (Yonhap) -- Prime Minister Lee Nak-yon visited Gunsan to discuss ways to revive the region's economy after General Motors Co. announced plans to close down its plant in southwestern city by May, government officials said Saturday. Gunsan, located 270 kilometers south of Seoul, now faces another blow to its economy due to the planned shutdown of GM's plant there. The city was already hit by Hyundai Heavy Industries Co.'s decision to close its shipyard there last year. Lee's visit comes after Song Ha-jin, head of the North Jeolla provincial government, asked the prime minister to come to Gunsan and check for himself the current situation facing workers there and discuss measures that can help the economy. The premier and other government officials had a meeting with Song, lawmakers with constituencies in the region, representatives from GM Korea Co.'s union and GM Korea's subcontractors Saturday afternoon, the officials said. "Putting the Gunsan plant back into production will be the best option to help the lackluster local economy. The government is in discussions with GM to minimize the fallouts (felt among workers at the Gunsan plant) following the planned shutdown of the plant and keep the regional economy from getting worse," Lee said without elaborating. Officials from GM Korea, which is 77 percent owned by GM, have not been invited to the meeting, as the Detroit carmaker is in talks with the Seoul government over ways to turn its loss-making Korean unit around. GM has asked the Seoul government to extend a financial helping hand to GM Korea, but Seoul demanded that GM first come up with a concrete investment plan for its continuing business presence here. It also demanded that GM Korea's union share the burden of staying afloat. The carmaker has hinted that it will ask employees to accept a freeze in wages as well as reduced bonuses and welfare benefits. If Seoul decides to help GM Korea with loans and investments, GM said it will consider allocating two new vehicles to its Korean plants to maintain a capacity of 500,000 units a year. Further details were not available from either side, as the talks are under way at closed meetings. GM said due diligence will be carried out on its operations so all sides can get a better picture of the situation facing its Korean unit. In 2017, GM Korea produced 520,000 vehicles at its car assembly plants, which have a combined capacity of 910,000 units. It sold 524,547 vehicles last year, down 12 percent from a year earlier. (END)