＂We will use Kwangyang if Pusan sticks to container tax,＂ shippers say

Pusan's decision to prolong container tax 10 more years repelled members of the trade industry, and pushed them toward using Kwangyang instead of Pusan.

The Korea International Trade Association (KITA) held a working level meeting with trading companies on November 1 and tried to take the proper steps to check the container tax extension. The trading industry made it a rule to push for the abolition of container tax articles, the base of local (regional) development. If it isn't accepted, trading companies will move en masse to cooperate in their efforts to use the Port of Kwangyang instead of Pusan.

KITA stressed that in the midst of aggravating difficulties in the trading industry and being required to improve price competitiveness through logistic cost savings, the container tax could present a serious hindrance for export companies in the course of their business. The highway construction in the hinterlands should be supplied from the central government, added the KITA.

It also said that container tax prolongation would run counter to the central government strategies, i.e., to raise South Korea as a hub port in Northeast Asia and to strengthen its international appeal and competitiveness. KITA also noted that other globally competitive ports, such as Singapore, Kaohsiung, and Hong Kong are actively drawing cargoes by preparing facilities and lowering port usage fees.

In the mean time, the City of Pusan has levied a container tax, 20,000 won per TEU since 1992 to meet the construction costs of highways in hinterlands. However, Pusan gave advance notice of the extension of the container tax for ten more years from 2002 to 2011 for fear of lack of funding from the central government to finish hinterland road construction.