By Jane Han
Staff Reporter
When the country's first bullet train opened for business in 2004, optimists said it would generate new growth in the slow regional economy, just like the Japanese Shinkansen and the French TGV did. But almost four years later, experts say, Seoul ― instead of the provincial districts ― seems to be the biggest beneficiary.
``What we're seeing is a `straw effect,' in which the capital city sucks in all the benefits of the high-speed train, originally intended to revive the local economy off the beaten tracks,'' said Hur Moon-koo, a senior analyst at the Korea Institute for Industrial Economics & Trade (KIET).
First shooting into service in April 2004, the Korea Train Express (KTX), which covers the 410-kilometer run from Seoul to Busan in 160 minutes, was meant to reduce the gap between Seoul and the less-developed areas by encouraging more domestic traveling by train.
Although this part of the purpose has been fulfilled, as more than 37 million passengers took the super-fast train in 2007, up 41.3 percent since its first year of service, research showed that travelers don't necessarily spend money.
``The number of travelers doesn't always translate into money, as not all of them take part in money-spending activities,'' said Lee Jong-ho, a researcher at the Korea Railroad Research Institute (KRRI).
KRRI's recent data shows that after the KTX service kicked off, Daejeon became a popular meeting point for businessmen from Seoul and Busan.
``People who often ride the speed train aren't tourists who tend to shop more, but those visiting family or going for business,'' he said. ``We wouldn't say these folks are major shoppers.''
But shopping venues surrounding Seoul Station, namely the Concos Mall and Galleria Department Store, have reportedly posted strong sales hikes, said Hur.
``Regional dwellers, especially those from the Chungcheong Provinces, prefer to take a quick ride and shop in Seoul, instead of their hometowns,'' he said, stressing that this has done more harm than good for provincial retailers.
Another minus factor for the southern regions is increased apartment vacancy rates, said Cho Nam-kwon, a senior researcher at the Korea Research Institute for Human Settlements, a non-profit organization for a balanced urban and rural growth.
``When college students from Seoul go to school out of town, they used to rent a studio near their campus, but these days, they commute from home,'' he said, adding that the landlords are complaining that the KTX negatively affected their potential demand base.
Although some negative side effects are spurring, Hur of KIET recognized that four years isn't a long period of time for a giant project to see its full range of impact.
``Hopefully, the bullet train will not only mature into a convenient service for all, but an economic generator for all regions, too,'' he said.
Phase two of the high-speed line, an extension of the existing Seoul-Daegu line to Busan via Gyeongju, is due to open in 2010.