Korean Shipbuilding Industry Faces Critical Challenges and Future Uncertainties

The global shipbuilding industry faces several critical challenges, including Korea-U.S. cooperation, Arctic shipping routes, and the development of liquefied natural gas (LNG) fields and related vessels. Kim Yong-hwan, a professor of shipbuilding and marine engineering at Seoul National University, highlights how these issues mirror past discussions from a decade ago at the Eastern Economic Forum, which focused on Korea-Russia collaboration and Arctic route development.

In the early 2010s, offshore plants were seen as a new growth engine for shipbuilders, following the decline of wind power projects. Significant investments were made in research, development, and human resources, but by 2014, shipyards began recording large losses. Professor Kim questions whether the industry systematically organized the skills, experiences, and lessons learned from these investments to build a sustainable knowledge system.

Currently, the Korean shipbuilding industry is performing well, with substantial order balances. However, this success is not solely due to technological competitiveness but also increased global demand for eco-friendly ships. China, which now dominates about 70% of the global market, is narrowing the technology gap in high-value-added ships like LNG carriers and ultra-large container ships. Chinese-built ships are also priced 5-15% lower than Korean ships, enhancing their market appeal.

Looking ahead, Professor Kim predicts an inflection point for the global shipbuilding industry around 2030. He emphasizes the need for Korea to secure excellent manpower, innovate productivity, and develop next-generation products to replace LNG carriers. Drawing lessons from Japan's decline, he warns that wrong policies and short-term management decisions may only become apparent during tough times, underscoring the importance of preparing for the post-boom period.