Minister of Oceans and Fisheries: "It's too early to sell HMM... Evaluation will change once all debts are paid off"

Munsung-hyuk "The government's role is to ensure the goose keeps laying golden eggs"

Moon Sung-hyuk, Minister of Oceans and Fisheries, is being interviewed at the Ministry of Oceans and Fisheries in the Government Sejong Complex on the 25th. / Sejong = Photo by Kang Jin-hyung aymsdream@

[Sejong=Asia Economy Reporter Kwon Haeyoung] On the 29th, Moon Sung-hyuk, Minister of Oceans and Fisheries, stated regarding the privatization of HMM, the largest domestic container shipping company, "I think it is not yet the right time (to sell)."

At a press briefing held at the Government Complex Sejong in the afternoon, Minister Moon said, "Currently, HMM's credit rating is BBB-, so it is not yet at the stage of complete independence," adding, "We need to solidify the foundation a bit more and consider (whether to sell) when there is a buyer in the market."

Currently under the management of creditors such as the Korea Development Bank and the Korea Ocean Business Corporation, HMM has achieved an operating profit totaling 4.679 trillion KRW through the third quarter of this year due to economic recovery and a shipping boom following COVID-19. Some argue that the sale should be pursued during this shipping boom period.

Regarding this, Minister Moon drew a line, saying, "The current shipping boom is caused by the logistics gap due to COVID-19 and port congestion following the United Kingdom's withdrawal from the European Union (EU)." He continued, "If HMM repays all the debt owed to the government and demonstrates stable net profit growth, the market's evaluation will change," explaining, "Our role is to make the goose strong enough to keep laying golden eggs, and when that happens, it should repay the government's debt."

He also highly evaluated this year's performance of the shipping industry. He said, "This year, the shipping industry has recovered to the level before the bankruptcy of Hanjin Shipping in terms of key indicators," and praised, "Thanks to HMM deploying temporary vessels as if squeezing a dry towel, it was able to cope well with the logistics difficulties."

At the time of Hanjin Shipping's bankruptcy, the shipping industry's sales were 39 trillion KRW. This year, sales are expected to exceed that with 40 trillion KRW and a container shipping capacity of 1.05 million TEU (1 TEU equals one 20-foot container).

Minister Moon mentioned, "In a situation where small and medium-sized shippers could not find shipping space, HMM withdrew other vessels and deployed temporary vessels as if squeezing a dry towel to ensure smooth exports," adding, "If there had been no national shipping company, an export crisis would have occurred."

Regarding the Fair Trade Commission's decision scheduled for the 12th of next month on whether to sanction domestic and international shipping companies for freight rate collusion, he said, "Although there are differences of opinion between the two ministries regarding the issue of freight rate collusion among shipping companies, we have communicated and made efforts to resolve them," adding, "I view positively that the plenary meeting date has been set."

The Fair Trade Commission sent a review report in May stating that about 120 freight rates set by 23 domestic and international shipping companies, including HMM, from 2003 to 2018 were deemed collusive acts, recommending fines up to 800 billion KRW. In response, the Ministry of Oceans and Fisheries argues that these cases are not collusion because the shipowners operated at rates even lower than those initially agreed upon with the consumer shippers.

This content was produced with the assistance of AI translation services.