The Gwangyang Bay Area Free Economic Zone in the nation’s southern region is fast recovering from a slowdown caused by the protracted global economic and the weak Japanese yen.

The GFEZ specializes in the steel and petrochemical industry and stretches across the provinces of South Jeolla and South Gyeongsang. The area includes the cities of Yeosu, Suncheon and Gwangyang, and Hadong County.

The GFEZ began its drive to develop “the world’s best industrial and logistic area” in 2004, and has since led the local economy by attracting an average of $1.5 billion in investments each year. The FEZ is a magnet for investors because of the Yeosu Industrial Complex, POSCO and Yeosu Gwangyang Port ― the second-largest trading area in the country, handling 251 million tons of transported goods last year.

 

However, investments started to falter in 2012, and in 2013 it only managed to receive $700 million, mainly due to difficulties in attracting Japanese businesses amid the weak yen and recessions in both the steel and petrochemical industries.

In order to overcome these difficulties, the GFEZ Authority concentrated on attracting investments by strategizing each industry, holding seminars and presentations for domestic and foreign investors, and pushing for customized incentives for potential investors.

Some of its notable achievements include receiving an investment of $120 million from Kumho Petrochemical, which was achieved by discussing environmental concerns and solutions with the locals in Haman, South Gyeongsang Province, and persuading them to allow the business.

SNNC Ferronickel also invested $140 million for a factory, due to the GFEZ Authority’s efforts in making changes to the development project and providing tax privileges for foreign capital.

 

As a result, the GFEZ managed to attract 33 companies in 2014, with double the investments from the previous year. The total investments amounted to $1.39 billion, with 3,426 jobs created and the zone continued to receive over 2 million 20-foot equivalent units in transported goods for the fifth consecutive year.

GFEZ Authority commissioner Lee Hee-bong said that despite the difficult economic conditions in Korea and abroad, he wishes to fulfill the initial goal of receiving $25 billion in annual investments by 2020.

Lee has set this year’s investment target at $2 billion, and plans to propel plans such as excavating biomaterial and chemical composition, establishing renewable energy businesses, increasing refrigeration and logistics, and providing specialized foreign investment areas.

The authority also vowed to do its best to attract many more investors to the area.

By Sang Youn-joo (sangyj@heraldcorp.com)