The Ministry of Trade, Industry, and Energy (MOTIE) announced the draft of the 3rd Basic Plan for Free Economic Zones at the 135th committee meeting held on June 29, and approved the proposed revised development plans for the Gwangju, Gwangyang Bay Area, and Incheon Free Economic Zones.
These plans are in line with the Government’s plans to develop free economic zones as global advanced business hubs for regional development, and attract KRW 100 trillion investment in Korea and abroad (from 2023 to 2032) and create 450,000 jobs by 2032.
The 3rd Basic Plan aims to implement a flexible total area control policy* to prevent indiscriminate designation and expansion of free economic zones while allowing for designation to actively reflect private needs and to respond promptly to local civilian demand.
*Total area control policy: To prevent excessive expansion and designation of free economic zones, the total area of all free economic zones is limited to 360 square kilometers (current area: 273 square kilometers)
In addition, in line with the regional development trend, the government is considering delegating significant authority to local governments, including the right to change the development plan of the free economic free zones. In order to boost the appeal of free economic zones for investment, the government is also considering the Most Favored Incentive system and support for R&D in advanced core strategic industries.
The three proposed changes to the development plans are: 1)Gwangju changed the land use plan and related project cost to create a future-oriented research industrial complex, 2)Gwangyang Bay Area added six new industries to attract space aviation and energy convergence industries to the Daesong Industrial Complex in Hadong District, and 3)Incheon changed the land use plan to support the Yongyu Oceanview and Muui LK Development as well as the establishment of an advanced aviation maintenance, repair, and overhaul (MRO) complex within Incheon International Airport in Yeongjong International City.
MOTIE plans to solicit opinions from local governments, free economic zone authorities, and related ministries on the draft of the 3rd Basic Plan, and announce the final plan in August through deliberation and decision by the Free Economic Zone Committee.