Korea-US Strategic Investment Corp., policy lenders and three major shipbuilders sign MOU to implement joint shipbuilding investment

An aerial view of Hanwha's Philly Shipyard in Pennsylvania, which has emerged as a symbol of the Korea-US shipbuilding cooperation project known as MASGA — "Make America's Shipbuilding Great Again." [Hanwha Ocean]
An aerial view of Hanwha's Philly Shipyard in Pennsylvania, which has emerged as a symbol of the Korea-US shipbuilding cooperation project known as MASGA — "Make America's Shipbuilding Great Again." [Hanwha Ocean]

A public-private consultative body has been launched to execute $150 billion in Korea-US shipbuilding cooperation investment. The move is expected to put the MASGA — "Make America's Shipbuilding Great Again" — project into full implementation, following the agreement reached at last year's Korea-US summit talks.

The government announced Thursday that the Korea-US Strategic Investment Corp., policy finance institutions including the Export-Import Bank of Korea, Korea Development Bank, Korea Trade Insurance Corp. and Korea Ocean Business Corp., along with domestic shipbuilders HD Hyundai Heavy, Samsung Heavy Industries and Hanwha Ocean, signed a memorandum of understanding at the Export-Import Bank of Korea's headquarters in Yeouido, Seoul. The MOU is aimed at ensuring the effective implementation of Korea-US shipbuilding cooperation investment.

At last October's summit talks in Gyeongju, the two countries allocated $150 billion of a total $350 billion in US-bound investment to shipbuilding cooperation through the MASGA project.

Under the MOU, the parties — including the strategic investment corporation, policy finance institutions and major shipbuilders — will form a Korea-US Shipbuilding Cooperation Investment Council. The council will jointly pursue information sharing among member institutions, identification of business opportunities and policy finance support, with the Export-Import Bank of Korea serving as secretariat to manage internal and external communications and track project progress.

Deputy Prime Minister and Minister of Economy and Finance Koo Yun-cheol said shipbuilding cooperation investment, alongside broader US-bound investment, forms "the two pillars of Korea-US strategic investment." He said the initiative "will be a mutually beneficial investment in which our world-class shipbuilders help rebuild America's shipbuilding industry while at the same time our entire shipbuilding ecosystem — from large shipyards to small and medium-sized yards and equipment suppliers — gains new orders and markets."

Koo also called on the Korea-US Strategic Investment Corp. and policy finance institutions to "prepare financial support measures so that sufficient funds can be supplied in a timely manner," and urged them to "actively seek ways to share the risks and early-stage investment uncertainties that individual companies cannot bear alone."

He asked major domestic shipbuilders to "actively identify projects in which the shipbuilding industries of both Korea and the United States can achieve a win-win outcome," and to "create pathways for small and medium-sized domestic shipbuilders and equipment suppliers to participate together as Team Korea."

Financial Services Commission Vice Chairman Kwon Dae-young said the Korea-US shipbuilding cooperation investment gives South Korea's shipbuilding industry "a golden opportunity to demonstrate its world-class capabilities." He added that the commission "will actively ensure that the necessary financial support is provided without disruption, based on close cooperation among the newly established Korea-US Strategic Investment Corp., policy finance institutions and private financial institutions."

Korea-US Strategic Investment Corp. President Park Jong-won said US-bound shipbuilding cooperation investment is "one of the core areas of Korea-US strategic investment and an important mission for the corporation's strategic investment implementation." He pledged to "work closely with policy finance institutions to actively support our shipbuilding industry's investment in the United States and vessel order acquisition."

Export-Import Bank of Korea Governor Hwang Ki-yeon said the bank "will work closely with the council's member institutions and companies to help K-Shipbuilding successfully enter the US shipbuilding market and secure new growth momentum."

Park Dong-il, director general for industrial policy at the Ministry of Trade, Industry and Energy, said MASGA is "the first-ever strategic overseas expansion project in the history of K-Shipbuilding," noting that "encouraging signs continue to emerge in the United States, including moves to place orders with Korean companies." He said timely financial support is "above all critical to maximizing these market opportunities and supporting companies' market entry."

Park added that he expects Thursday's signing ceremony to serve as "a catalyst for the MASGA project and a springboard for a new leap forward for our shipbuilding industry," and called on policy finance institutions to "ensure smooth cooperation so that companies can enter the US market without disruption."

Lee Sang-gyun, chief executive of HD Hyundai Heavy, said the shipbuilding industry "will leverage its world-leading technological capabilities to identify diverse investment opportunities with profitability and feasibility." He expressed hope that "the government will also put in place multifaceted support measures to jointly create a new turning point in Korea-US shipbuilding cooperation."


oskymoon@heraldcorp.com