Busan-Jinhae FEZ Attracts $188 Mil. Plant

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Summary

Kim Moon-hee, commissioner of the Busan-Jinhae Free Economic Zone Authority(BJFEZA), signed a MOU(memorandum of understanding) with the CEO of Tae Kwang(TK) Corporation on founding a pipe plant by the second half of 2009. Its establishment is projected to make some 450 jobs for 188 billion won ($188 million) plant.
Moreover, Otofuji, a Japanese industrial machinery firm, joins this foundation with a 30 billlion won. The BJFEZA stated it is very satisfied with the contract because of an ideal case including FDI and it continues to give an advantage when some company attracts a foreign firm. Through this signing, more than 90 percent of Hwajeon district is occupied.
The BJFEZA is also trying to develop an additional site to meet investors’ wants and secure more space for the zone. It is the second South Korean FEZ ,seated on 105 square kilometers, and has induced a total of $4.8 billion in investment and aims to entice $200 million this year.

Opinion

South Korean FEZ appointment was made before about 5 years. There are three FEZ in Korea, Incheon, Busan-Jinhae, and Gwangyang and the invested scale is estimated about 35trillion won($350 billion). How huge the amount is! However, why did the FEZ fail? I will explain especially in BJFEZ.
The BJFEZ has a good geographic condition near Pusan Newport accommodates a lot of shipment. So the BJFEZA should induce the domestic and foreign excellent firms to establish the factory as well as a financial firm. The Korean government has to reduce the tax rate including other advantages. I think its aim will be the BJFEZ is in Korea but not likely in Korea. As a district distribution, they must define industrial, financial, and tour area surely. Even though I know this process can be get briefly and that is true, the Korean government and the BJFEZA will steadily try to induce and attract FDI(Foreign Direct Investment).

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