Seen above is a bird-eye view of Songdo International Business District in Incheon. / Courtesy of Incheon Free Economic Zone Authority
By Choi Kyong-ae
The decision to select Korea as the site for a new U.N. fund meant a major breakthrough for the Incheon Free Economic Zone (IFEZ) as having such a big name usually helps attract foreign capital.
Board members of the Green Climate Fund said in October last year the fund designed to manage billions of dollars to help developing countries combat climate change will be located in Songdo, Incheon City.
The IFEZ, the country's first free economic zone, has strived to woo foreign direct investments (FDIs) to transform it into a major business hub of Northeast Asia in terms of knowledge and technology-based business, tourism and services industry in the past 10 years since its opening in 2003.
Spurred by the incoming presence of the Green Climate Fund in December and the World Bank's decision on Friday to open a branch in Songdo late this year or early next year, the free industrial complex said in a statement it expects an increase in FDIs.
FDIs in three districts of Incheon ㅡ Songdo, Youngjong and Cheongna ㅡ soared to $2.13 billion in 2012 from $554 million a year earlier. The corresponding figure so far this year stands at $926 million, showed the data released by the IFEZ.
For the whole of last year, the IFEZ accounted for 13 percent of the country's overall FDIs valued at $16.26 billion and it marked 67 percent of the Incheon City's overall FDI records of $3.18 billion, said the statement.
Other global organizations that already joined or are lined up to enter the IFEZ include the Association of World Election Bodies (A-WEB) and the United Nations Economic and Social Commission for Asia and the Pacific (ESCAP). UN ESCAP is created to help the countries of Asia-Pacific achieve equitable economic and social development through regional cooperation.
"The presence of such global organizations in the IFEZ will enhance its competitiveness among global economic-zone peers and help Korea take the lead in the worldwide green-growth initiative," IFEZ Commissioner Lee Jong-cheol said in the statement.
The IFEZ will have a total 12 international organizations by the end of December including A-WEB, it said.
Under the 17-year project to be completed by 2020, Songdo will be transformed into the city of education and technology-based industry, while Youngjong putting a focus on the logistics and tourism business, and Cheongna looking to the financial and auto industry.
"It is a sea change. High-rise buildings are lined up in the manmade territory, once just a mud flat, and big companies such as Posco (Korea's largest steelmaker by sales) and Amco Technology (from the U.S.) have their operations there," the commissioner said.
The IFEZ said it plans to attract 640,000 residents to the three districts in Incheon City and 45 percent of the three areas have been developed. As of the end of August, 181,742 people resided in the economic zone and the population there is on the increase.
Last but not the least, education and medical business will also be a major driver for the economic zone, said the IFEZ.
In its aggressive drive to build a global campus in Songdo, the IFEZ is planning to attract regional branch schools of 10 foreign universities and about 10,000 students by 2020.
U.S.-based Chadwick International School opened its branch in Songdo in September 2010 and in March last year the State University of New York began its graduate school course here. Next year, George Mason University and University of Utah from the U.S. and Ghent University from Belgium are set to start their programs, according to the IFEZ.
"Talks are underway to draw more universities such as St. Petersburg Conservatory, Moscow State Ballet Academy and Houston University," said the statement.
Separately, medical research companies such as Celltrion, Samsung Biologics, Berna Biotech and Dong-A Socio Holdings have joined forces to seek growth under the name of "bio mecca."
Still, achievements in Songdo are being offset by lack of outstanding results in Youngjong and Cheongna districts. Most of plans have just received an approval or the beginning of the construction is years away.
Among the planned projects, German automaker BMW will invest 70 billion won to build the BMW Group Driving Center in Yeongjongdo by July 2014. Shinsegae, Korea's retail giant, plans to build a mega shopping mall in Cheongna by 2017.