Anchor: Gwangju city government and Hyundai Motor held a ceremony on Thursday to sign an agreement on their low-wage carmaking joint venture known as the "Gwangju Job Project." The government-led initiative to boost employment, however, was met with strong opposition from some labor unions.
Choi You Sun has this report.

Report: Some 400 people, including President Moon Jae-in, government officials, lawmakers and members of the Gwangju city government's negotiating committee attended Thursday's deal signing ceremony at the Gwangju City Hall.

Under the agreement, the city government and Hyundai Motor will invest 59 billion won and 53 billion won, respectively, into the 700-billion won joint venture to build a factory with an annual production capacity of 100-thousand vehicles.

City officials expect the new plant to create jobs for up to 12-thousand people.

Workers will be paid an annual wage of 35 million won, less than half of what the automaker’s unionized workers earn.

But to make up for lower wages, the local government will provide workers with housing, education and health care.

The deal was struck Wednesday after labor representatives in the negotiating committee agreed to suspend annual wage negotiations until the plant reaches an accumulated production of 350-thousand units, which is expected to take the first five years.

An additional clause in the deal said details of future wage negotiations will be discussed between the union and the management.

Denouncing the latest move, the South Korean umbrella labor group Korean Confederation of Trade Unions, which was not involved in the negotiations, said it will stage an all-out battle against the deal.

The group denounced the agreement as a "political performance" and a "fraud" that will eventually threaten production and jobs in the region.

It said that the five-year wage suspension clause in the deal destroyed the country's labor rights guaranteed by the Constitution, adding it will conduct a legal review of the wage negotiation suspension.

Union members of Hyundai Motor and its affiliate Kia Motors also staged a partial one-day strike in protest of the deal.
Choi You Sun, KBS World Radio News.