FT Energy Source The greening of Korean industry may not be all that it seems

By Christian Oliver in Seoul

We saw more huge numbers from South Korea this week, pledging all sorts of green initiatives in its dirty, industrial economy. But what passes for ‘green’ here may come as a surprise.

First, the good news. Seoul will set up a $1.25bn fund next month to spur environmental business. It also expects its 30 biggest companies to spend $18.6bn on green technologies over the next three years. Bravo. South Korea has experienced one of the fastest development trajectories of any nation and has created a grim environmental mess. It is the fastest growing carbon emitter in the Organisation for Economic Co-operation and Development. Going green makes excellent commercial sense. China is closing in steadily on Korean industry and the big companies understand this. The ailing shipbuilders are putting far more emphasis on building wind turbines and solar panels. Samsung will put $21bn into new growth engines over the next decade. This sum includes some investment in healthcare, but chiefly means more hi-tech electrical systems, whether they be more efficient light bulbs or entire “smart cities”.

In fact, these companies understand the impending showdown with China far better than the government. South Korea’s renewables target of 6 per cent by 2020 is risibly low and many of the big companies would prefer it to be higher to kindle a greater domestic market.

More broadly, there are some big caveats. Firstly, always be wary of any numbers out of Korea. All Korean numbers are aspirational and no-one gets into trouble if they are not met. Secondly, the OECD has warned Korean companies not to fall over each other and glut the market, forming green bubbles.

Most alarmingly, the government has no scientific definition of what it means by “green” and is in no hurry to produce one. Environmental scientists are tearing their hair out, as Seoul rides rough-shod over international standards and agreements while being feted internationally for its green rhetoric.

The government and construction companies will tell you tourism is “green”. Much of the Korean countryside has already been savaged by construction and many so-called green projects are just an excuse to lay more tarmac, build hotels and develop wilderness that should be left as animal habitat. After all, the president is a Hyundai construction man. South Korea’s continuing land reclamations of fragile wetlands are an environmental disgrace and take a disdainfully cavalier approach to the Ramsar convention. I have heard officials refer to nuclear power, country drives and eating whale as “green”.

So, who will determine whether Korea takes a genuinely green path? This week’s Economist has a job advert seeking an executive director for the Global Green Growth Institute in Seoul. South Korea could benefit from someone who is strong enough to demand some scientific standards on the government’s fluid rhetoric on things green.