The government plans to select nine areas in the country’s major commercial cities to develop highly efficient industrial complexes with adjacent accommodation through deregulation by 2015.
In an investment and trade meeting presided over by President Park Geun-hye at Cheong Wa Dae on Wednesday, the Ministry of Strategy and Finance said these will not only lead to job creation but reinvigorate its inefficient systems for industrial site operations.
“We must closely evaluate the potential (economic) effects such measures would bring, even if we inevitably have to implement regulations for public and environmental safety,” the president said.
“We must gather as many opinions as possible from the private sector before we put forth these measures into legislation,” she added.
Its measures also include drastically remodeling the existing 25 industrial complexes that are more than 30 years old. There are a total of 102 industrial complexes that have been operating for more than 20 years.
The government’s key agencies such as the Ministry of Trade, Industry and Energy and the Ministry of Land, Infrastructure and Transport have already chosen six areas where they hope to attract both businesses and households through environmental deregulation, land price cuts and public service fee cuts.
The other three areas are expected to be selected soon, the ministries said.
Korea is seeking to overhaul its industrial landscape to better align with its creative economy and technology convergence policies. It hopes to do so by retooling inefficient complexes that have failed to attract businesses in part due to high land prices and their remoteness from commercial cities.
Industrial complexes, which have played a critical role in driving Korea’s economic growth for the past 60 years, will be recreated into creative clusters to boost youth employment, according to the Ministry of Trade, Industry and Commerce.
It will allow private companies to build residential and commercial buildings like hotels, theaters and cafes.
The number of industrial complexes nationwide has continued to rise, reaching 993 as of 2012 since the country’s first industrial complex in Guro-dong in 1964 for light industries. The Guro complex is currently called the Seoul Digital Industrial Complex, housing start-ups and midsize companies in sectors such as software and gaming.
“Despite the huge economic contribution of industrial complexes to the Korean economic development, they are losing competitiveness and youth workforce. It is urgent to upgrade industrial complexes to make the youth come back,” said Jeong Marn-ki, a deputy minister for industrial creativity and innovation at MOTIE.
“The ministry will select two industrial complexes within next month for remodeling,” Jeong said.
The ministries will also move to deregulate, allowing tourist hotels to be built near school areas, so long as such developments would not include harmful facilities to students such as establishments that facilitate gambling and room salons.
They hope their choices for the six advanced sites in close proximity to the cities’ major business districts will create more than 36,000 jobs by encouraging the private sector to invest 10.5 trillion won over the next four years.
By Seo Jee-yeon and Park Hyong-ki