New Container Hub in Asia

Commissioner Choi wants to attract companies that can create jobs and container cargoes to GFEZ to make Gwangyang Harbor a container hub in East Asia

Commissioner Choi Jong-man of the Gwangyang Bay Free Economic Zone Authority (GFEZ) is proud of the achievements in the zone since its establishment six years ago and plans to step up its further development by securing more foreign investments and enticing more container cargoes by attracting more firms to set up plants inside the GFEZ. The commissioner said priority will be given to firms that can create more jobs and container cargoes, along with those in clean energy, such as solar and wind power, as well as high-tech and food processing industries.
Following are excerpts from a written interview between NewsWorld and Commissioner Choi:
Question: You came to the Gwangyang Bay Free Economic Zone Authority as its third commissioner in March. How do you feel now?
Answer: I feel very honored to have taken the position on March 19 after finishing my duties as vice mayor of Gwangju City, but at the same time, I feel a heavy pressure because the job is a very important one. I feel very happy and fortunate to work in my hometown, since I was unable to during my 31 years of public service. I would like to point out that the Gwangyang Bay Free Economic Zone has all the characteristics of Ulsan’s Petrochemical Industrial Complex, Pohang Steel Complex and Busan’s Container Piers, which have been a mighty force for Korea’s astounding economic growth. Therefore, I would like to do all I can by taking advantage of my public service experience, human network connections to expand the number of businesses in the bay area and increase the cargoes coming in and out of the bay in an effort to help the GFEZ flourish.
Q: Can you tell us about the achievements made by the GFEZ since the commencement of its operations six years ago?
A: Since its opening in March 2004, the GFEZ, despite its low profile, succeeded in attracting 80 businesses with a total investment of 6.51 trillion won, creating 17,165 jobs, making a huge contribution to the local economy.
By attracting 31 foreign businesses, the GFEZ has developed into a hub for international trade, boosting the Gwangyang Bay to be a leading port in Northeast Asia.
Those foreign firms invested a total of 2.59 trillion won in the zone, which came to 90.3 percent of total foreign investments made in South Jeolla Province during the past six years, although the number of firms accounted for only 39.2 percent of all foreign firms that moved to the province. The containers handled at the harbor numbered 1.19 million TEU before the opening of GFEZ, but it has now been expanded to 1.81 million TEU, rising 53 percent by the end of 2009.
Since 2005, GFEZ took over the development of No. 1 Yulchon Industrial Complex from Hyundai Motor since its progress had not been on target due to the 1998 financial crisis. In the four years since, the industrial complex now has 55 businesses operating plants in the complex including Hyundai Steel, Samwoo Heavy Industry, SPP Group and Orient Shipbuilding, among others, and the work on the backyard of the complex has seen 59 percent progress so far and is scheduled to be completed in 2011.
The Hwayang region, which is being developed as a leisure area, is 27 percent completed and is sure to reach 50 percent before the year is out, including the construction of an 18-hole golf course.
The No. 4 complex in the Hwayang sector, designed to be a shipbuilding complex, began work on Feb. 23, and work on the Daesong Industrial Complex will also be starting soon.
As you can see, the GFEZ, despite a short history since its launch, has played a core role in the development of the economy of the province, while boosting the economy of the eastern region.
Q: What about the progress of the development of the industrial complex?
A: We at the authority have been doing all we can within our administrative power to develop the complex in full. It has gotten to the point where we are getting enquiries from many companies who wish to enter the complex, making it hard to accommodate everyone who wants to set up plants there.
The No. 1 Industrial Complex, now being developed with a total space of 9.19 square km (2.78 million pyeong), has seen 81 percent of its space allocated to tenant firms and all of its space will be allocated by the end of the year, raising the need for the development of the No. 2 complex. The projected No. 2 Yulchon Industrial Complex is on the drawing board of the Ministry of Land, Transport and Maritime Affairs. The ministry plans to build embankments and reclaim the space within to build a harbor with a total area of 8.9 square km (2.7 million pyeong), a background area of 5.1 square km and an industrial complex with a total space of 3.9 square km (1.15 million pyeong), subject to approval by the advisory committee on free economic zones under the Ministry of Knowledge Economy.
When the plan for the projected No. 2 Yulchon Industrial Complex is approved, some 600 billion won will be ploughed into the development of the projected complex from this year so that it will be able to allocate spaces to industrial firms that want to set up plants inside the complex starting in 2015. The companies in such areas as labor-intensive, high value-added electric, electronic, nonferrous, transport equipment, and precision medical equipment manufacturing will be given priority.
At the same time, the Sepung General Industrial Complex, with an area of 1.97 square km (590,000 pyeong), the Gwangyang Hangkum Industrial Complex, with an area of 2.59 square km (780,000 pyeong) and the Sunchon Haeryong Industrial Complex, with an area of 0.62 square km (190,000 pyeong), are being planned for development.
Since the industrial complexes don’t have enough space, we are looking to industrial complexes being operated or planned in nearby cities including Yeosu, Gwangyang, Hadong, Gurei and Konhung, to see if they have enough space for businesses to set up plants.
Q: What are your plans for attracting businesses to the GFEZ?
A: We plan to focus on creating jobs by attracting well-run businesses both at home and overseas and, at the same time, invigorate the local economy. We plan on attracting steelmakers, machinery assembly, precision chemical, new materials, logistics, tourism, leisure, medicine, education and developers based on our business attraction strategies set up for the five sections inside the GFEZ through our intensive marketing campaigns.
We plan to invite leading firms with high job creation effects to the No. 1 Yulchon Industrial Complex, and high-tech industries, machinery and parts industries, shipbuilding parts companies and other foreign capital invested firms to set up shop in the free trade zone with 343,000 square meters of available space.
In the background areas of the complex, we plan to invite foreign schools, hospitals with high-tech medical equipment and specialized colleges to set up and operate facilities. We will send representatives to international expositions held both at home and abroad, contact KOTRA and foreign chambers of commerce extensively to build a cooperative network to find potential investors in our industrial complex and make direct calls on them to make sure that they will locate to the GFEZ. In May, we traveled to Japan to sign an investment contract with a Japanese firm to set up a solar energy parts manufacturing plant in the No. 1 Yulchon Industrial Complex. In June, we visited China to sign an agreement with a Chinese auto parts maker to invest 20 billion won in a plant in the complex. We also traveled to France in June to hold talks with a French yacht maker and a high-tech company on their possible investments in the Yulchon Industrial Complex.
Q: What are your plans to attract cargoes to the Gwangyang Harbor of the GFEZ?
A: The Gwangyang Harbor area has easy access to products from the industrial plants located inside the nearby industrial complexes, such as steel plates and other steel products from POSCO’s steel plant and raw materials for chemical products from the Yeosu Petrochemical Complex in Yeosu, and can export the products easily from the 16-berth harbor. The location of the GFEZ is very good, as it is close to a number of key local industrial zones including the southern coastal belt of the Middle South Economic Area, set up by the government under a strategy for balanced national development. We plan to attract many businesses that need container shipment of their products by giving them priority if they are deemed able to create more jobs. In order to secure increased cargoes for Gwangyang Harbor, we pay calls on cargo owners and businesses in North Jeolla Province to tell them about our upgraded cargo handling facilities at the port. We also traveled to such Chinese cities as Tianjin, Qingdao and Hong Kong from May 24 to 28 to entice container cargoes and Chinese firms to relocate to the backyard of the harbor under our target marketing programs.
We are glad to note that cargoes handled at Gwangyang Harbor are up 19.5 percent to 851,000 tons as of the end of May thanks to the economic recovery. If this trend is any indication, we don’t see any problem in meeting our target to entice 2 million TEU in container shipments out of the harbor by the end of the year. We plan to draw up measures to continue to secure container cargoes based on the assessment of world logistics trends.
Q: What are major plans and targets to be pursued by GFEZ?
A: We are going to step up our efforts to secure increased investments to further develop the zone based on the excellent results achieved by the GFEZ in the past six years. We also plan to continue with our efforts to build more industrial complexes near the GFEZ including the Hwangkum Industrial Complex, the No. 2 Yulchon Industrial Complex, the Shindae Background Complex, the Haeryong General Industrial Complex, the Sepung General Industrial Complex, the Galsa Bay Shipbuilding Complex and the Daesong Industrial Complex, which are either being developed or in the process of consolidating their plans. We set the investment attraction target at $1.3 billion, which will be drawn from companies in such areas as steel, petrochemical and other traditional manufacturing firms, along with clean energy firms including solar, wind and other new recycled energy businesses. We also plan to attract high-tech industries and food processing firms and related industries to the zone. We also plan to give a hand to the economy of the south central zone, along with pursuing the development of logistics, leisure and green industries. At the same time, we plan to take advantage of international events taking place in our region including F1 Korea Grand Prix, the 2012 Yeosu World Expo and the 2013 Suncheon World Garden Expo to promote foreign investments in our zone.
Commissioner Choi is a graduate of Seoul National University with a major in shipbuilding and a master’s degree in administration from Seoul National University Graduate School. He went on to study at Senshu University Graduate School in Japan and earned a doctorate in law.
He held many important positions during his 31-year government service career. Choi worked at the Presidential Office, Cheong Wa Dae, as an inspector in charge of diplomacy and national security at the National Affairs Coordinating Office between July 2000 and March 2003. He was director in charge of public safety policy at the Ministry of Public Administration and Security from February 2003 to August 2005.
He was also vice mayor in charge of administration in Gwangju City from March 2008 to March 2010. nw

Commissioner Choi Jong-man of the Gwangyang Bay Free Economic Zone.