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Smoke billows from chimneys as factories churn in Pohang, South Korea’s steelmaking heartland. The city, a key player in the nation’s industrial growth, now faces uncertainty due to former President Donald Trump’s new tariffs on steel imports.
Pohang has been instrumental in South Korea’s economic rise, producing steel for decades. As the fourth-largest steel exporter to the U.S., South Korea supplied 13% of America’s total steel imports last year. However, growing foreign competition has already strained the industry, and Washington’s planned 25% tariff on steel imports—set to take effect next month—could exacerbate the situation.
Steel Industry at Risk
“The steel industry is a vital national industry that serves as a fundamental material for key sectors such as construction, automotive, and shipbuilding,” Pohang Mayor Lee Kang-deok told AFP.
Lee warned that if the industry collapses, it could destabilize South Korea’s economy. “If we fail to respond effectively to President Trump’s tariff measures, our country’s economy could face an even greater shock, leading to an irreversible situation.”
The Backbone of South Korea’s Economy
Located 270 kilometers southeast of Seoul, Pohang stands as a rare industrial hub in a country where economic activity is largely concentrated in the capital. The city is home to South Korea’s top steelmaker, POSCO, along with industry giants like Hyundai Steel and Dongkuk Steel.
“Pohang has long been a symbolic steel city that has supported South Korea for decades, serving as a backbone for the country’s development,” said Bang Sung-jun, a former Hyundai Steel worker and an official at the Korean Metal Workers’ Union’s Pohang branch.
Workers Feel the Impact
Despite its economic importance, the steel industry has been under increasing pressure from oversupply, particularly from China, and declining global demand. Trump’s tariffs are expected to intensify these challenges, and analysts predict that if cheap Chinese steel, barred from the U.S. market, floods other regions like Southeast Asia and Europe, South Korean producers will face even stiffer price competition.
“Trump’s protectionism will certainly affect South Korea’s already struggling steel industry, which is squeezed by low-price exports from China and an unfavorable Japanese yen exchange rate,” Vladimir Tikhonov, professor of Korea studies at the University of Oslo, told AFP. “The impact will be significant.”
Factories Closing, Jobs Disappearing
While some argue that South Korean firms could find new export markets, workers in Pohang fear for their job security. Several steel mills have already shut down, and more layoffs appear imminent.
An AFP visit to a Hyundai Steel factory that closed last year revealed signs hung by unionized workers demanding an apology from management. Through an open door, debris could be seen piled up inside.
“For us workers, it has always been a crisis without any opportunities,” said unionist Bang.
The Future of Pohang’s Steel Industry
Lee Woo-man, a subcontractor for POSCO for two decades, shared his fears, noting that 20 of his colleagues have lost their jobs in the past year. He expects employment in the city to “decrease even more” over the next four years, with Trump’s tariffs accelerating the decline of what was once a thriving industrial hub.
Lee recalled his childhood in Pohang, watching smoke rise from the chimneys of massive mills and thinking, “POSCO is feeding Pohang.” Now, that sight fills him with anxiety.
“I don’t know when this will all fall apart.”
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