[THE INVESTOR] The Korean government is in discussions with General Motors to use the closed Gunsan factory as a way to boost the local economy and employment, a senior industry official said on June 5.

The American carmaker shut down the Gunsan factory, located 274 kilometers south of Seoul, on May 31 as part of a global restructuring plan aimed at cutting costs.

The plant shutdown poured cold water on the city, with a population of 270,000, which was already reeling from the closure of Hyundai Heavy Industries’ shipyard last year.

“The government is well aware that Gunsan’s economy is undergoing a very hard time,” Moon Sung-wook, a senior official at the Ministry of Trade, Industry and Energy, said in a meeting with reporters. “Discussions are currently under way with GM and other related ministries to find a relevant way to utilize the plant at an earlier date.”

As part of efforts to revitalize the local economy, the government last month designated the port city as an emergency response zone so as to provide residents with job support and tax incentives.

“The Gunsan factory is GM’s asset and it doesn’t plan to use it for car manufacturing, but the production line is decent,” Moon said. “If there‘s anybody that can make good use of it, GM is ready to cooperate with the (Korean) government in any way” including through an asset sale.

By Song Seung-hyun and newswires (ssh@heraldcorp.com)