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[News Focus] LH Corp. relocation move spurs controversy

Reports on the alleged selection of Jinju as site for head office anger Jeolla politicians, residents


Allegations that state-run land developer Korea Land & Housing Corp. headquarters in Gyeonggi Province would be relocated to Jinju, South Gyeongsang Province are prompting uproar from its rival region of North Jeolla Province.

The news came on Sunday from a high-ranking ruling Grand National Party official who said the government has chosen Jinju, and the finalized plan will be announced by the Presidential Committee on Regional Development within the month.

The Ministry of Land, Transportation and Maritime Affairs remained cautious to make hasty remarks, saying that nothing has been decided yet.

The government has reportedly decided to select Jinju in an attempt to calm Gyeongsang residents’ anger over the recent scrapped airport project.

In March, Korea decided to scrap its plan to build a new international airport in the southeast, as two candidate sites ― Miryang and Busan ― failed to meet requirements for economic and environmental feasibility.

Among the Jeolla residents, Jeonju citizens are harshly protesting the alleged selection of Jinju as a winning city to host the public housing firm headquarters. Instead, the government reportedly plans to establish a development administration for Saemangeum project in Jeonju, the largest city in North Jeolla Province, or relocate a public corporation of a similar size such as Korea National Pension Service to the city. The NPS was originally planned to be moved to Jinju.

LH Corp. was established by a merger between the Korea National Housing Corporation and the Korea Land Corporation in 2009 to improve competence.

The two institutions both previously had a large amount of debt, which resulted from competitions between the two for their overlapping businesses.

Prior to the arrangement, the former Roh Moo-hyun administration had decided in 2005 to relocate Korea Land Corp. in Jeonju, while the Korea Housing Corp. would be moved to Jinju.

Competition between the two cities has thus been brewing as locating the firm would bring in additional tax revenue of 30 billion won ($27 million) as well as push the region’s development.

Despite the Lee Myung-bak administration’s pursuit of the principles of the balanced regional development proposed by the previous administration, it has failed to decide on the venue for LH’s relocation.

“Though the government has reviewed the split relocation plan, it decided that it would be inefficient and almost impossible for the CEO and 1,500 employees to go back and forth between the two cities,” the anonymous official said Sunday.

Politicians and residents of South Gyeongsang Province welcomed the news, while those of North Jeolla Province, who had been hoping for a split relocation, seemed shocked.

Some, including Chung Woon-chun, a member of GNP’s Supreme Council, even argued that the decision should be put to the vote among LH employees for it would be the best-suitable choice.

Meanwhile, the final decision for the venue for locating the multibillion dollar science-business belt is also poised to be made by the regional development committee on May 18, people familiar with the matter said.

By Koh Young-aah (youngaah@heraldcorp.com)
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