Politicians and residents from Pohang, North Gyeongsang Province, speak during a press conference at the National Assembly in Seoul, Thursday, to protest POSCO's plan to set up a holding company in Seoul. Courtesy of North Gyeongsang Provincial Government

By Park Jae-hyuk

POSCO is facing a severe backlash from residents and politicians in its home city of Pohang, North Gyeongsang Province, over its plan to set up a holding company in Seoul, while spinning off a subsidiary in charge of its successful steelmaking business.

North Gyeongsang Province Governor Lee Cheol-woo, Pohang Mayor Lee Kang-deok and lawmakers representing the city's residents made a statement at the National Assembly, Thursday, in protest of the envisioned relocation of POSCO's head office. The city's politicians also plan to visit the POSCO Center building in Seoul, where an extraordinary general meeting of shareholders is scheduled for Friday to vote on the spinoff plan.

They claimed that POSCO is disregarding Pohang citizens, who have endured pollution from POSCO's steel mill over the past half century, with the abrupt announcement of its restructuring plan late last year.

"For balanced regional developments, companies in the capital area should move to non-capital areas, but POSCO is trying to establish its holding company in Seoul and locate its R&D facility in the capital region," the Pohang mayor said.

The North Gyeongsang Province governor described POSCO's plan as "retrogressive."