Mayor Ahn Sang-Soo of the Metropolitan City of Incheon Forming a cluster comprising Gaesung manufacturing, Seoul finance, and Incheon IT logistics As Mayor Ahn Sang-Soo of the Metropolitan City of Incheon, successfully wrapped up his North Korea tour May 30-June 2 with a delegation from the City, Incheon is emerging as a center of exchange with North Korea and as a gateway to Northeast Asia. For the first time for a local autonomous entity, the Incheon City delegation made an official visit to Pyeongyang and Nampo for three nights and four days during which the two city governments and agreed to jointly hold the 2014 Asian Games. Accordingly, both sides plan to jointly submit a written application to hold the Asian Games to OCA (Olympic Council of Asia) by the end of June. Providing the two sides of North and South make efforts to faithfully abide by mutual agreements regarding humanitarian matters, Mayor Ahn says that Incheon can emerge as a city which symbolizes peace. He further expects that these efforts by Incheon City would not only have a positive effect on the Free Economic Zone, but also positively impact on North/South relations. During the delegation's Pyeongyang visit, the Incheon City mission agreed with its North Korea counterparts to jointly drive forward a raft of cooperative exchange projects. They include attracting the 2014 Asian Games, promoting exchanges in the fields of gymnastics, culture and the arts, and joint participation in the 16th Asia Track and Field Championship this year. Mayor Ahn, who underscored that Incheon City will put emphasis on boosting inbound investment, says in a special interview with The Korea IT Times that the City's 'Buy Incheon' project is a large-sized project through which the City plans to attract over 25 trillion won in investment this year and over 200 trillion won during the next 10 years. To drive forward this project, the Mayor said that Incheon City will actively seek foreign private capital. Through this strategy, the City will aim to produce jobs and inject new vitality into the local economy, he said. Furthermore, the Mayor encourages investment into the City, underscoring that interest in investing in Incheon appears to be high due to a local regeneration project, the introduction of new business, and urban/rural balanced development projects. Incheon City, in the meantime, was the driving factor behind the creation of the Incheon Free Economic Zone on July 1, 2003 to create a new growth engine of the 21st century and to steer national development. To date, the City has succeeded in luring foreign funds worth over $20.7 billion and is striving to build city infrastructure facilities such as an international convention facility aimed at attracting business generated by the 2008 Beijing Summer Olympics and the 2010 Shanghai Expo. To develop as an international city which is on a par with competing cities, the Mayor said Incheon City initiate community development projects in a significant way. Injecting vitality into the local economy Incheon is a hub of Northeast Asia with an international airport and port which serves as a bridgehead for exchange with North Korea as that country steadily opens up to the outside world. In that regard, Mayor Ahn explained that Incheon City will inject new vitality into the local economy by harnessing the capabilities of the Gaesung Complex, Seoul's financial institutions and Incheon's logistical infrastructure. As Incheon emerges as a center of an exchange with North Korea and the government promises an active support to promote the Incheon Economic Free Zone's success, he said he is confident that 2005 will be the year of Incheon. Provided this project is pursued smoothly as scheduled, the Mayor said he believes that Incheon will become the most vital city in Korea, adding that he would put his heart and soul into bringing about a boom in Incheon by all means. Under the 'Buy Incheon' project, Incheon City has designated this year 'The Year of Investment in Incheon' and next year, 'Visit Incheon Year' and under the 5 strategies of improving governance, developing a 'pentaport,' urban renewal, encouraging voluntary service and building social capital, the City is striving to realize its vision of Creating Incheon as a gateway to Northeast Asia'. To finance this overall project, Mayor Ahn said that Incheon City's budget of 3.93 trillion won this year is up 15.7% in comparison with preceding year, in order to concentrate more on improving the quality of life and to continuously pursue the goal of promoting Incheon to the position of Northeast Asia's international logistics/ business center city. Q: First of all, could you elaborate on Incheon's plan to attract and nurture the Ubiquitous IT industry Songdo Intelligent City, for example, is attracting attention because of its project to introduce Ubiquitous IT at all levels of government, business and society. A: Incheon is playing the role of a gateway city for Korea and is striving to become an economic, social and cultural center of Northeast Asia. I believe that the reason why Incheon is attracting attention for its focus on the Ubiquitous IT industry is because a host of industrial complexes are close by and form a huge rear market. In addition to such a special feature, Incheon is expected to carry out a role as a gateway port not only for Korea, but also China. Both for domestic industry and for industry overseas in China as well as Russia and Japan, I believe that Incheon could offer an important manufacturing as well as distribution opportunities, which can help these industries gain access to a vast range of markets. Incheon s IT promotional plan is five-fold: First off, Incheon will attract IT companies to the Namdong and Shiwha industrial complexes that are part of the IFEZ. At the same time, we will work with these companies to help build a Ubiquitous IT environment in Incheon. Second, our strategy is to lure future-oriented industry among IT companies and companies matching IFEZ's development profile. For instance, the Digital Contents Industry, which is well suited to Incheon, could be attracted to and nurtured in the DEC (Digital Entertainment Cluster). Third, our city will get rid of legal barriers to allow IT companies to be able to advance their business proactively and grow their support systems as necessary. Fourthly, the type of IT company that Incheon wants to attract is not the type of company that is targeted solely at the domestic market. We will lure core companies which are globally competitive and whose business is strongly focused overseas. Fifthly, nurturing IT companies for us is not merely about fostering IT itself. We will make efforts to lure similar industries across the IT value chain and secure the necessary manpower, and support network base to allow these companies to develop autonomously. Q: How are your efforts going to attract foreign investment A: Under very poor economic circumstances at home and abroad, the Incheon Free Economic Zone has attracted foreign capital investments worth $20.7 billion over a total of 17 cases. These include 5 firm contracts and 5 MOUs (memoranda of understanding) to date since its inauguration. First off, by entering into an agreement worth $12.7 billion with Gale International of the U.S. to build the international business center in Songdo, Incheon City has received approximately $50 million (59.3 billion won) as payment toward land sales and construction of its convention center began in March this year. In addition, Celltrion, established as a joint venture by VaxGen of the U.S. and Korea's KT&G, plans to enter the Songdo cutting-edge bio complex for which Incheon City has concluded a contract worth US$150 million (180 billion won) for phase 1 of the project. Since Celltrion will install world-class drug manufacturing facilities and plans to increase the company's capacity during phase 2 by 2009, an additional influx of foreign capital is forecast. In regard to the Incheon Great Bridge which is being built to link Incheon International Airport situated on two islands in Incheon harbor, and Songdo New City on the mainland, it is forecast that $1 billion (1.2 trillion won) capital is forecast to be invested into the project via an agreement with AMEC of Britain. A joint venture between U.S. and German companies will construct Songdo New Port through an investment of $1.5 billion (1.8 trillion won), while AMEC will invest an additional $2 billion (2.4 trillion won) in the international business zone of Incheon International Airport. Nord Anglia Education Group plc, a leading British provider of education, training and childcare, is scheduled to establish a foreign school to accommodate some 2,000 children from kindergarten to high school within the Incheon Free Economic Zone through an investment of US$20 million (23 billion won). Since global IT companies have expressed interest in establishing R&D centers here, we expect to see their plans materialize sooner or later. Q: Could you describe the overall shape of Incheon's foreign investment promotion effort A: The essence of our strategy is to select first-rate global enterprises as our investment targets. By using our 'Buy Incheon' campaign as an incentive we re certainly hoping to lure some big corporate fish to Incheon. Other big pluses about our city we're hoping to promote to the wider world are our foreign school and foreign hospital programs, which we sincerely believe will make a huge difference to the living environment and generally help make the city more foreigner-friendly. Q: What's going with Incheon's program to develop the Free Economic Zone A: At present, we're developing the Incheon Free Economic Zone in three separate sections measuring an area in total of 63.36 million pyung (209km2). The Zone is at the core of Incheon City's strategy to build a logistical base here to serve the whole of Northeast Asia. First, on Yeongjong Island, the location of Incheon International Airport, a customs-free zone as well as an advanced logistics complex will be established to maximize the synergies associated with being located so closely to this major center of Northeast Asian aviation. As a high value-added marine and air transportation center, the zone will be promoted as a key logistics hub of Northeast Asia in connection with Pusan and Kwangyang Ports. In addition, the islands of Yongyu and Muui, whose natural scenery is so striking, will be developed as worldlevel leisure resorts. Second, the Songdo area, vested with leading IT infrastructure, will be nurtured as an international business and R&D center. Thirdly, we're going to create a tourism/leisure/theme park complex in the Cheongna area that will be linked to Seoul by the New Airport Expressway and the high-speed railway, which is expected to be completed by the end of 2005. Q: How would you say things are going A: Right now we're seeing a lot of development in the Songdo area in line with our staged plan to attract foreign capital. In fact, we're already seeing ongoing overseas investment into the Songdo international business complex, knowledge information industry complex, and state-of-theart bio complex. In the case of Yeongjong, Incheon City will get behind the Yeongjong area project, which will involve the development of some 5.70 million pyung.