Daegu Mayor Choo Kyung-ho Strives to Prevent Fallout from Taewang E&C Court Receivership

Emergency Countermeasure Meeting of Relevant Agencies
Call for "Implementation of Taewang’s Self-Rescue Measures"

On August 25 at 3 PM, Daegu Metropolitan Government held an "Emergency Countermeasure Meeting of Relevant Agencies" at the Sanggyeok Government Office in response to the court receivership (corporate rehabilitation procedure) application by Taewang E&C Co., Ltd. During the meeting, participants discussed measures for cooperation among agencies to prevent damage to subcontractors and to block a cash crunch in the local construction industry.

The meeting, presided over by Daegu Mayor Choo Kyung-ho, was attended by representatives from major financial institutions such as iM Bank, the Financial Supervisory Service, and Korea Credit Guarantee Fund, as well as the chairpersons of the Daegu chapters of the Construction Association of Korea, the Korea Specialty Contractors Association, and the Korea Mechanical Contractors Association, along with officials from Taewang E&C Co., Ltd.

Daegu Mayor Koo Kyung-ho (left) is holding an emergency countermeasure meeting to discuss measures following the court receivership of Taewang ENC.

During the meeting, participants shared the current status of Taewang E&C’s application for court receivership and the broader regional construction industry, while also discussing measures to provide liquidity support to the sector and to ensure the smooth progress of various projects.

Based on the city's assessment, it was found that there is no significant disruption to the ongoing public construction projects led by the Daegu Metropolitan Government. In addition, there are currently no residential projects in Daegu being undertaken by Taewang E&C in the private sector, so immediate direct impact has been avoided.

However, participants agreed that, given the possibility of the court receivership’s impact expanding to subcontractors and partner companies, and even triggering a broader cash crunch in the local construction sector, prompt and preemptive joint action is urgently needed.

The city has decided to actively implement the "direct payment system for subcontractor payments" at government-funded construction sites while monitoring the court receivership proceedings in real time. The government will also swiftly take administrative measures such as designating substitute constructors if necessary.

Financial institutions, meanwhile, will actively review effective financial support measures to assist partner companies experiencing temporary liquidity crises due to the court receivership. The Financial Supervisory Service and local construction associations have agreed to monitor on-the-ground liquidity issues and the overall scale of damage in real time to prepare necessary responses.

Taewang E&C officials also pledged to fully implement self-rescue measures, such as asset sales and restructuring, in order to minimize losses to partner companies and the wider economic impact on the region.

Daegu Mayor Choo Kyung-ho stated, “With the local construction sector already facing hardship from a prolonged slump in the real estate market, news of Taewang E&C's court receivership application is very concerning. Effective financial support from Korea Credit Guarantee Fund and iM Bank, as well as responsible execution of self-rescue measures by Taewang E&C, are needed. Daegu Metropolitan Government will also mobilize all possible resources to prevent this situation from escalating into a broader crisis for the regional construction industry.”

This content was produced with the assistance of AI translation services.