"Gwangyang Bay Area Free Economic Zone (GFEZ) Authority is striving to offer more incentives to foreign investors as part of its effort to attract more foreign investment and stimulate the free economic zone," a top official of the authority said.
"To activate foreign investment, we plan to supply over 10 percent of the industrial and logistics site to foreign-invested firms when they establish a development plan in the GFEZ," said Choi Jong-man, commissioner of GFEZ. "Such a project will also be applied to industrial areas currently under development including Yulchon, Sepung, Hwanggeum, and Haeryong Industrial Complexes," he noted, adding that these areas will become a magnet to attract foreign investment.
The GFEZ Commissioner then explained how along with this project, we are now requesting the government to ease the ceiling on foreign investors' minimum investment from $30 million to $10 million for manufacturing companies and from $10 million to $5 million for logistics and tourism firms in a bid to entice leading foreign investors. This is intended to facilitate the designation of land into a special foreign invested area thus, granting better chances for foreign companies to succeed. He also mentioned how the GFEZ, along with central government agencies, including the Ministry of Knowledge Economy, is recommending the National Assembly to enact a special law stipulating the procedures for the setup of foreign profit-making medical institutions.
Under the present law, the establishment of a foreign hospital in the country is possible in principle, however; actual setup of such a hospital is very difficult mainly because of insufficient laws and regulations related to procedures on the establishment of a foreign hospital. Choi provided an example stating, "The scope of those working for foreign medical institutions is limited to foreign doctors, dentists and licensed pharmacists. Meanwhile, drugstores exclusively for foreigners cannot sell medication to Koreans."
The GFEZ also requested the National Assembly to revise the special law concerning foreign educational institutions as soon as possible in an attempt to attract top-ranking foreign educational institutions by allowing them the overseas remittance of profits.
Prospects for the development of GFEZ
When asked about the prospects for development of GFEZ, Commissioner Choi said, "GFEZ is currently facing many difficulties, including economic slowdown at home and abroad under global competition, stiff competition with other free economic zones, and the easing of regulations in the metropolitan area."
"As an initial step, we are focusing our strength on attracting leading projects and expanding infrastructure by the end of this year. As the second step, we will concentrate our efforts on creating modern community areas for foreign investors and enticing promising foreign enterprises," he said.
Noting that Gwangyang Port has set the target for container traffic volume at 12 million TEU by 2020, he said, "GFEZ Authority will strive to achieve the ambitious target through active marketing measures both at home and abroad."
Choi further explained, "Gwangyang area will emerge as a new growth axis of Korea in 2020 with the attraction of over $20 billion in investment, the creation of 200,000 jobs, an increase in residents' annual income to $50,000, and a population of 1.2 million."
Characteristics of GFEZ
Commenting that the GFEZ is located near China, which is a huge emerging market within Northeast Asia, and has the appropriate conditions for logistics and trade, Choi said, "Accordingly, Gwangyang Port and its neighboring region were designated as a free economic zone in October 2003, and the GFEZ Authority opened in March 2004."
A total of 15.7 trillion won will be invested into the five districts of the GFEZ: Gwangyang, Yulchon, Sindeok, Hwayang and Hadong, which will perform functions of manufacturing, logistics, residencial, educational, medical services, tourism and leisure.
"When the development project is completed, GFEZ will enjoy 164 trillion won worth of total economic outcome and 66 trillion won of value added income," the commissioner said.
Noting that the GFEZ is a special economic zone boasting of excellent geographical conditions and growth potential, he said, "First of all, other positive factors to consider are that GFEZ possesses a vast industrial area in addition to Gwangyang Port, which ranks 13th in the world in terms of cargo processing. Along with this, POSCO Gwangyang Steelworks, the world No. 1 in crude steel production, and Yeosu National Industrial Complex, which produces 56 percent of domestic petrochemical products, are all located in the Gwangyang Bay area."
"We will also actively make the best use of world class events such as the F1 Korea Grand Prix, the EXPO 2012 Yeosu and the 2013 International Garden Exposition in the Suncheon Bay in Korea to attract investment from Korean and foreign enterprises," added Choi.
GFEZ's attraction of foreign investment
Since its establishment in March 2004, the authority has attracted a total of US$7.3 billion in domestic and foreign capital from 93 companies and created some 20,000 jobs, greatly contributing to regional development, despite such difficult conditions, including economic slowdown both at home and abroad.
Choi stated, "Of the 93 firms, in particular, 33 are foreign companies, including SNNC of New Caledonia, and Meiya Power Company Ltd. of Hong Kong, indicating that Gwangyang bay area has succeeded in becoming an international trade stronghold."
During the 2004-2010 period, 33 foreign companies invested a total of $2.62 billion in the Gwangyang bay area "This indicates that the degree of contribution the GFEZ has made to the South Jeolla Province is extraordinary," said the commissioner.
"Cargo volumes at Gwangyang Port have also increased 17.6 % from last year to 1.56 million TEU during the first nine months of 2010, playing a great role in stimulating the port," he said.
