Incheon Fair Foreign Investors Eyeing Incheon Free Economic Zone
By Do Je-hae
Staff Reporter
The 80-day Incheon Fair & Festival was a great opportunity to expose potential investors to the Incheon Free Economic Zone (IFEZ), officials said, following its closing ceremony on Sunday.
The IFEZ Authority signed MOUs with several foreign firms, including Boeing, Samsung TESCO and McCaffery Interests last Wednesday for a variety of development projects, according to Incheon Mayor Ahn Sang-soo.
"The MOUs are proof that more businesses around the world perceive Incheon as the right place to invest. Based on these and past investments, we will do our utmost to bring in more foreign businesses to the IFEZ in the future," Ahn said. Boeing has committed to building a training center for their pilots in the IFEZ and the McCaffery Interests will develop a world-class hotel and shopping district in the area.
The new business partnerships come at a time when expectations for the IFEZ are running high, especially with the Oct. 15 opening of the majestic Incheon Bridge, the world's seventh largest. Celebrating its sixth anniversary, the IFEZ has been attracting more global attention, with world-acclaimed media outlets visiting the city to cover its development history and future prospects.
One of the major goals of the festival was to bring the world's attention to the evolution of Incheon as a major international business center through the completion of the IFEZ. The world's first festival on urban development models for the future was initially conceived a few years ago by Ahn, partly to publicize the IFEZ.
"Visitors and the media from all over the world paid keen attention to our city and the Incheon Free Economic Zone during the festival," Incheon Mayor Ahn Sang-soo said during a press conference Monday. U.S. broadcasters CNN and ABC as well as CCTV from China covered the festival. "The global branding of Incheon will greatly expand opportunities for investment in the IFEZ," he said.
The mayor said that he will plan a large-scale event every two years specifically to increase the global branding power of Incheon and to introduce the lesser known parts of the IFEZ, including the Yeongjong and Cheongna areas.
The IFEZ, which is scheduled to be completed in 2014, will house more than 300 Northeast Asian business headquarters, 30 international organizations, including those affiliated with universities.
IFEZ Roadmap
Some reports by the international media attacked Korea for creating too many free economic zones. However, the government contends that each of the six zones have their own geographical and industrial merits that will lure foreign investors, transforming Korea into an international business hub for Northeast Asia in the long run.
The IFEZ will be devoted to international finance, IT, biotech industries, tourism and educational facilities. The IFEZ is now in its second-phase stage of development that will continue until 2014. The five-year scheme will be mainly focused on fine-tuning infrastructure and the further development of conditions that are more friendly to foreign businesspeople, IFEZ Commissioner Lee Heon-seok said in a September interview with The Korea Times.
``By then, most areas of the economic zone will be completed. The Cheongna area will have all its residents, and more than 50 percent of the Youngjong area development plan will be finished,'' Lee said.
Based on the results of the first-phase projects, IFEZ plans to set up strategies for the second stage. With projects in IT, design and natural environment, Incheon will press on with a development scheme to build a hub for business, distribution, IT and tourism. It also plans to develop its role as a center for education and medicine. The roadmap for the second phase will be confirmed by November and publicized in December.
The centerpiece of the IFEZ is Songdo International City, which is 64 kilometers from Seoul. It is the largest development project of its kind in Korea and there are hopes it will become Northeast Asia's new multicultural center of business and education. "Songdo has the geological advantage to become the business hub of Northeast Asia thanks to Incheon International Airport, Incheon harbor and advanced technologies," Lee said. Songdo is just 15 minutes away from Incheon International Airport.
Officials and business experts said that the recent opening of Incheon Bridge will significantly improve logistics in the IFEZ. The country's longest bridge connects the Songdo Business District to Yeongjongdo, where the airport is located.
"The bridge is an instrumental infrastructure for the IFEZ. Its completion will undoubtedly advance the country's policy of becoming a business hub of Northeast Asia," Lee said.
Leader of FEZ Movement
Industry experts have said that the key to the success of a free economic zone is to expand tourism facilities and attract visitors from home and abroad. In this regard, Incheon has fared better than other parts of the country that are also developing Free Economic Zones of their own.
A FEZ initiative is currently underway at six locations across the nation ― Incheon, Busan-Jinhae, Gwangyang Bay Area, West Sea, Daegu-Gyeongbuk and Saemanguem-Gunsan.
A Free Economic Zone (FEZ) is an area specially designated to provide companies with the optimal environment to engage in global business activities. Ultimately, FEZs are aimed at building world-class cities based on policies of global standards and catering to multinational and multicultural communities. They will additionally be equipped with quality schools, hospitals, and transportation and tourism facilities.
In 2003, Korea joined a long list of countries, including China, India, Malaysia and the United Arab Emirates, in designating Free Economic Zones (FEZ) with light taxes for two specific reasons ― to create friendlier business conditions for foreign investors, and to seek the balanced growth of all provinces.
A key national agenda item of the previous Roh Moo-hyun administration was to seek balanced regional development. It paid particular attention to placing formerly underdeveloped provinces such as North Jeolla or Chungcheong Provinces on the industrial map of the country through new development ventures.