Kim Jonggwan Questions "Are Samsung Electronics' Profits Solely Labor-Management Gains?"... Urges Mature Resolution Ahead of Strike (Comprehensive)

Kim Jungkwan, Minister of Trade, Industry and Energy, is answering reporters' questions at a press briefing held on the 27th at the Government Complex Sejong. Ministry of Trade, Industry and Energy.

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Kim Jonggwan, Minister of Trade, Industry and Energy, responded to the Samsung Electronics union’s strike announcement by questioning, "Should the company’s achievements be attributed solely to the management and the engineers and workers employed there?" and called for a mature judgment from both labor and management. He emphasized that, as semiconductors are a core industry linked to the entire national industry, business partners, shareholders, and local communities, this cannot be viewed as a simple labor-management issue within an individual company.

At a press conference held at the Government Sejong Complex on the 27th, Minister Kim highlighted the possibility of a strike at Samsung Electronics, stating, "There are countless infrastructures and partner companies involved with Samsung Electronics, as well as over 4 million minority shareholders and the National Pension Service’s stake in the company."

Minister Kim stressed that, given the nature of the semiconductor industry, it is necessary to consider not only the current profit distribution but also the capacity for future investment. He said, "The semiconductor industry is one that cannot survive without continuous large-scale investment. At this stage, there must be a balance between enjoying some profits now and reserving some for future competitiveness." He added, "It raises the question of whether company profits should only be divided among those inside the company or if it is an issue that should involve everyone who forms part of the semiconductor ecosystem."

Minister Kim pointed out, "Semiconductors remain the only industry in Korea that is still competitive, but the gap is narrowing. As we have seen in cases like Intel and Japanese companies, once competitiveness is lost, it is very hard to recover." He urged, "While workers certainly deserve their share, I hope both labor and management will fully consider their respective roles and reach a mature conclusion."

Regarding the possible end to the petroleum price ceiling system, Minister Kim clarified, "There is no predetermined end date," but stated, "Our basic policy is to end it as soon as possible once the war is over or oil prices stabilize."

Minister Kim compared the price ceiling system to a summer ‘mosquito net.’ He said, "When the mother asks to close the door because of mosquitoes and the father asks to open it because of the heat, all the son can do is put up a mosquito net. Similarly, the price ceiling is not an entirely satisfactory measure, but it is an unavoidable step to stabilize oil prices and reduce the burden on the public." He added, "Just as you can close the door when the weather cools down or open it when there are no more mosquitoes, the system can be ended once the situation stabilizes."

He stated, "Price controls do not align with my philosophy. However, there are clearly market conditions right now that make it necessary to maintain the price ceiling system."

Regarding an exit strategy, he proposed several conditions. Minister Kim said, "Ending the war is important, and after the war, it is crucial to see if the flow of crude oil through the Strait of Hormuz returns to normal. In addition, we must also consider the introduction of a post-settlement system under discussion in the National Assembly and the restructuring of domestic oil distribution systems, such as the termination of exclusive contracts." He added, "What happens to oil prices is ultimately more important than simply whether the war ends."

He also explained the background behind the consecutive freezing of the third and fourth rounds of price ceilings. Minister Kim said, "In the third round, oil prices rose but the ceiling was frozen; this time, oil prices have fallen slightly but the freeze continues. Last time, there was a burden from raising prices, and this time, there was a burden in immediately reflecting the drop. In the end, the decision was made to maintain price stability."

Regarding the issue of compensating oil refiners for losses, he explained, "Refiners submit their data through accounting firms, and the cost estimation committee verifies the process." Minister Kim said, "Decisions will be made so that refiners neither gain excessive profits nor suffer excessive losses. The intention is to compensate only for losses incurred due to the price ceiling system."

On the gradual rise in gas station retail prices despite the price ceiling freeze, he explained, "The price ceiling applies to refinery supply prices, and anything above that added by gas stations is determined by competition and local community sentiment." He added, "No gas station can raise prices excessively and remain free from criticism by the community. Currently, there seems to be a certain equilibrium between gas stations and consumers."

He also addressed the issues of petrochemical sector restructuring and supply chain stability. Minister Kim said, "The Middle East crisis raises the question for the petrochemical industry of whether supply chains-from agricultural film to syringes-can be destabilized. Society needs to reach a consensus on whether to rely on cheap imports or to use public subsidies to keep essential items produced domestically."

However, he stated that the policy direction of moving the petrochemical industry toward higher value-added products will be maintained. Regarding restructuring in the Ulsan region, he said, "Rather than being an issue for government intervention, I believe the industry should be allowed to discuss and address it autonomously, and we are waiting for that."

On M.AX (manufacturing artificial intelligence transformation), he emphasized, "This is not an issue of whether to do it or not-it is a matter of survival for the industry." Minister Kim said, "AI factories, tacit knowledge projects, and workforce training must all proceed together. The demo factory planned for Changwon will serve as a destination for companies to see what they should ultimately aim for."

Regarding labor opposition, he said, "We will fully consult with all stakeholders," but added, "The introduction of robots and AI is not about eliminating jobs, but about revitalizing the manufacturing field." He said, "If industries that were previously avoided transform into sectors that require robot managers, those jobs can become more attractive to young people and women."

On the recent Coupang data leak issue, he said, "My role is to ensure that it does not escalate into a trade issue," and added, "The best course of action is to continuously explain the position and sincerity of our government to the U.S. side." He continued, "While the U.S. may view it as a minor data leak, we see it as a very serious data breach, and this is a fundamental difference."

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