Kyoto compliance could cost Korean companies

Kyoto compliance could cost Korean companies

South Korea's steel and automobile manufacturing industries will likely feel an initial pinch when a United Nations (UN) agreement aimed at reducing greenhouse emissions goes into effect on February 16th. While South Korea, the world's ninth largest producer of greenhouse gases, earned a reprieve until 2012 for implementation of the Kyoto Protocol, the government voluntarily decided to begin cutting back on greenhouse emissions this year. The country's steel and automotive sectors are among the biggest contributors of gases that cause global warming. The South Korean Chamber of Commerce and Industry says that implementation of the Kyoto Protocol and the government's voluntary measures will likely drive up production costs in the affected industries. While that may seem worrying to companies that are concerned about their bottom lines, one business lobby group argues that compliance with the environmental agreements will actually help the country's automotive industry in the long run. The lobbyists explain that the move will force automobile manufacturers to develop more fuel efficient engines and hybrid vehicles, which could prove extremely profitable if consumers become more eco-friendly and are willing to pay a premium for “green” automobiles.