Industrial power costs averaged at around 100 won per kWh in Malaysia, but the Sarawak authorities cut the prices to manufacturers there as incentives.“Production costs of OCI Holding’s Malaysian unit are likely to be less than half of those in Korea, given lower power bills and corporate tax cuts,” said an industry source in Seoul.“There are fewer reasons to do business in Korea as time goes by.” Other Southeast Asian countries such as Vietnam and Indonesia where many South Korean companies operate production facilities supply electricity at cheaper prices.
Battery makers LG Energy and SK On are also setting up facilities in the state.Hanwha Q Cell Co., a solar power unit of South Korea’s chemicals-to-defense conglomerate Hanwha Group known as Qcells in overseas markets, established a solar energy hub in Cartersville, Georgia.“In the past, Korean companies moved out of the country mainly due to strict regulations and high corporate tax rates, but more local firms now mention expensive power bills,” said an industry source said.
South Korean manufacturers moved abroad as electricity bills were higher by about 30% than those of major economies such as the US and China after the government ramped up power prices.
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