Group Chairman's Absence Takes a Toll
Lotte Chemical’s four-trillion won petrochemical project in Indonesia has been suspended due to the absence of group chairman Shin Dong-bin, who is now in prison for bribing ex-President Park Geun-hye.
Hwang Gak-kyu, a Lotte Group vice chairman, said on Sept. 10, “Many projects, including the one in Indonesia, have been halted due to our internal problems.” He met reporters on the sidelines of the Korea-Indonesia Industrial Cooperation Forum held in Seoul on Sept. 10 ahead of a summit between President Moon Jae-in and Indonesian President Joko Widodo.
The Indonesian petrochemical complex project has been promoted by Lotte Chemical Titan, a subsidiary in Malaysia acquired in 2010. The project is the largest in scale among overseas development projects pursued by the group. Yet it has made little progress during the past one and half years due to the group chairman’s absence.
The group listed Lotte Chemical Titan on Malaysia’s stock market in 2017 and planned to invest more than 80 percent of the funds raised through the IPO in the Indonesian project.
“We may be able to push the project again only after the release of the chairman. He would make an investment decision after taking a look at the site,” Hwang said.
The appellate court is schedule to hand down a verdict on Shin on Oct. 5. “He hope the court makes a wise decision and helps us resume our suspended projects,” Hwang said.
Meanwhile, Hwang had a meeting with the visiting Indonesian president on Sept. 10. At the meeting, Hwang said Lotte Group is planning to expand its partnership with Indonesia to social infrastructure, backbone industries, startup promotion and cultural projects. He hoped that the Indonesian government would provide more support for Lotte.
Lotte entered Indonesia in 2008 by opening Lotte Marts. Approximately 9,000 Indonesian employees are currently working for its 11 subsidiaries, including Lotte Department Store, Lotte Chemical and Lotte GRS. In addition, Lotte chairman Shin Dong-bin is currently serving as head of the Korea-Indonesia Partnership Council.