Incheon has emerged as one of the most forward-looking and innovative areas of South Korea. The Incheon Free Economic Zone (FEZ) on the west coast consists of Yeongjong, Songdo and Cheongna and will, in due course, become a hub for the world’s largest advanced information technology and logistics companies. Its extraordinary position midway between Japan and China and at the centre of north-east Asia promises to create a magnet for international companies.
FDI has surged in Korea during 2004, to the highest level for three years. It reached $3.4bn during the first nine months of the year, which is a 71% increase on the equivalent period in 2003. Incheon is part of a government strategy to create an FDI sector in Korea to compete with rivals Hong Kong, Shanghai and Singapore.
International companies should note the determination and vision of the Korean authorities. They are putting not only funds but also enormous imagination into the project, which promises to put Korea at the top of the region’s industrial and research agenda for the next century and beyond. Lee Hwan-kyun, commissioner of the Incheon FEZ, says: “By bringing sophisticated IT industries and logistics mechanisms into Incheon, it will promote its business environment to become attractive enough to persuade millions of foreign investors.”
The list of names that have already committed major investment to Incheon testifies to international confidence. For example, US real estate developer Gale Company has undertaken an $12.7bn investment to build an international business hub. VaxGen, a US-based global bio-technology corporation, is constructing a protein-producing plant to develop new medicines; and DHL, the international courier company, has a major regional base there. A host of US schools and medical facilities enhance the FEZ’s facilities for international companies.
An alternative city
Incheon is expected to have all the facilities of a very modern commercial city by 2008. This will be called New Songdo City and, with its 3.3 square kilometre site to the north-west of Songdo, will serve as an international business and technology belt. Mr Lee says Songdo New City “will become an alternative to Seoul. It will be a city where business people can both live and do business”. New Songdo City will, in due course, have 4.6 million square metres of office space and accommodate half a million people. Plans are afoot to build 35,000 new homes. Observers of New Songdo City say it will be “the most audacious piece of real estate in the world” and “the world’s most advanced technological city”.
The truly modern infrastructure at the heart of Songdo will include a convention centre capable of hosting conferences for international companies. A second airport bridge is also being built to improve communications between Incheon International Airport (where amenities are space age) and New Songdo City. About $1.5bn has been designated for the building of a port and $2bn will be used to build an international business complex at Incheon airport.
Architectural excellence, as well as modernity, will echo through the streets of New Songdo City, say planners. They are building 6km of canals into their plans. This will produce a sense of historic Venice or the Chicago waterfront amid the most up-to-date high-rises man can build.
Mr Lee says: “We provide top-notch services at low prices, and multinational companies will opt for Korea rather than China, where the logistics network is still weak.”
Plans for Incheon are ambitious and its development has a long way to go. But the FEZ is powering ahead and the government expects it to be completed by 2020.