KORAIL receives license to establish Suseo KTX affiliate

The Ministry of Land, Infrastructure and Transport on Friday issued a license for the state-run rail operator to establish an affiliate to run a new branch of the KTX line, despite fierce opposition from labor unions and others.

The issuance is expected to increase pressure on the 27 percent of KORAIL’s 20,443 employees who have been on strike since Dec. 9 against what they claim to be a move to privatize the railroads.

“The Daejeon District Court on Friday evening approved the registration of the Suseo bullet train route, followed by the ministry’s licensing of the railway business establishment,” Transport Minister Suh Seoung-hwan said at a press conference on Friday night. “The era of competition in the railroad business has begun … but I assure you that the railroad will remain in public hands,” he said.

The licensing means KORAIL and the Transport Ministry can begin to seek investment from the public sector for the affiliate, which will run the new bullet train route out of Suseo in southwestern Seoul from as early as 2015.

The decision is also expected to induce further resistance from labor unions. About 1.7 million members of the Federation of Korean Trade Unions and the hard-line Korean Confederation of Trade Unions have vowed to stage a general strike from Saturday if the government pushes ahead with the plan.

The management and unionists of KORAIL have failed to reach an agreement on ending the strike. KORAIL chief executive Choi Yeon-hye gave an ultimatum to the unionists to return to work by midnight Friday, after talks earlier in the day were fruitless.