The nation’s free economic zones, specially designated regions to attract foreign investment, will face restructuring based on their development performance, according to government officials.

After a 10-year-long investment, Korea has eight FEZs, and the number of business districts in them has soared to 101. However, only 52.5 percent or 53 business districts are under development.

“A revised law in August 2011 gave FEZs three years to find a land developer. Based on the law, the government can cancel the designation unless an FEZ finds a developing partner by August next year,” said Park Jae-yeong, an official from the Industry Ministry.

The ruling will be applied to six FEZs: Incheon, Busan-Jinhae, Gwangyang, West Sea, Daegu-Gyeongbuk and Saemangeum-Gunsan.

The East Sea FEZ and North Chungcheong FEZ will be given more time, as they were not designated until early this year.

Despite decade-long investment since 2003, few FEZs have pushed for their development plans as scheduled. Others have made little progress in development after the designation because they failed to develop attractive plans to draw investment, and construction companies shun FEZ development projects amid the protracted property market slump.

In a bid to revive the FEZs, which were pushed for the last 10 years under the vision of building a Northeast Asian business hub, the ministry adopted the “selection and concentration” and “specialization” strategies, issuing the first basic FEZ development plan which covers the next decade from this year.

According to the plan, the ministry will invest 82 trillion won ($7.2 billion) by 2022 to develop FEZs, up from the 58 trillion won the ministry spent between 2003 and 2012.

“The goal of FEZs for the second period is to build a world-class business environment and to attract multinational companies and create jobs,” said Kim Sung-jin, director general at the ministry’s FEZ planning office.

For this goal, the ministry will develop cluster-type business districts in FEZs and gradually allow domestic companies to enter the zones.

“The investment of leading domestic firms in FEZs is needed to attract multinational firms,” Kim said.

The ministry will also develop some districts in the FEZs as a test bed for service industries such as long-distance medical services, which deal with complicated regulations.

By Seo Jee-yeon  (jyseo@heraldcorp.com)