FEZ's the business hub of Northeast Asia
- What is a Free Economic Zone (FEZ)?
- A Free Economic Zone (FEZ) is an area specially designated to provide companies with an optimal environment to engage in global business activities.
- - A cluster of global companies is formed by providing advanced socio-economic systems and diverse incentives.
- - World-class cities are built through development of cutting-edge airports, ports and office facilities as well as high quality schools, hospitals and tourist facilities.
- Portrait of future FEZs
- Epicenter of Northeast Asian network
- - FEZs will offer a venue for win-win development in Northeast Asia where people, information and technology converge. They will provide an optimal business environment based on policies of global standards, multicultural and multinational communities, and an innovative and pleasant living environment.
- Logistics hub of Northeast Asia
- - FEZs will emerge as the logistics center of Northeast Asia by capitalizing on Korea's geographical position and first-rate airports, ports, TSR and TCR.
- Hub of value-added service industries
- - FEZs will provide an optimal business and living environment to rise as the center of business support services such as international finance, legal service, accounting, information systems and strategic consulting, as well as home to headquarters of multinational corporations. They will also boast premier education, medical, shopping, tourism and leisure services.
- Hub of cutting-edge industries
- - FEZs will develop into the R&D and manufacturing center of cutting edge technologies and knowledge-based industries such as IT, BT, NT and CT by utilizing Korea's advanced technology and production capabilities. They will offer a pleasant living environment to attract the best people.
- Timeline
- - Dec. 30, 2002
- Adoption of the Act on Designation and Management of Free Economic Zones (effective as of July 1, 2003)
- - Jul. 1, 2003
- Inauguration of Free Economic Zone Committee
- - Jul. 10, 2003
- Establishment of Free Economic Zone Planning Office
- - Aug. 6, 2003
- Designation of Incheon Free Economic Zone
- - Oct. 15, 2003
- Launch of Incheon Free Economic Zone Authority
- - Oct. 27, 2003
- Designation of Busan-Jinhae and Gwangyang Bay Area Free Economic Zones
- - Mar. 24, 2004
- Launch of Gwangyang Bay Area Free Economic Zone Authority
- - Mar. 30, 2004
- Launch of Busan/Jinhae Free Economic Zone Authority
- - May 6, 2008
- Designation of Daegu/Gyeongbuk, Yellow Sea, and Saemangeum/Gunsan Free Economic Zones
- - Jul. 22, 2008
- Launch of Yellow Sea Free Economic Zone Authority
- - Aug. 13, 2008
- Launch of Daegu/Gyeongbuk Free Economic Zone Authority
- - Aug. 28, 2008
- Launch of Saemangeum/Gunsan Free Economic Zone Authority
- Designation status (as of September 2008)
- A total of 6 FEZs have been designated and are under operation:
- 1st phase - 3 zones (2003: Incheon, Busan/Jinhae, Gwangyang Bay Area),
- 2nd phase - 3 zones (2008: Yellow Sea, Daegu/Gyeongbuk Knowledge Creation, Saemangeum/Gunsan)
| Name | Location | Completion date | Area | Focus industries |
|---|---|---|---|---|
| Incheon | Incheon | 2020 | 209km² | Business, IT.BT, international finance, shipbuilding |
| Busan/Jinhae | Busan, Gyeongsangnamdo | 2020 | 104km² | Maritime logistics, automobiles, machinery, shipbuilding |
| Gwangyang Bay Area | Jeollanamdo, Gyeongsangnamdo | 2020 | 90km² | Maritime logistics, materials |
| Yellow Sea | Gyeonggido, Chungcheongnamdo | 2025 | 55km² | Automobile components, IT.BT, value-added logistics |
| Daegu/Gyeongbuk | Daegu, Gyeongsangbukdo | 2020 | 39km² | Education, medical service, fashion, IT, components, materials |
| Saemangeum/Gunsan | Jeollabukdo | 2030 | 66km² | Automobiles, shipbuilding, components & materials, green industries |
FEZ Development Framework
Development, operation and investor support are proceeding in accordance with the Act on Designation and Management of Free Economic Zones.
FEZ Committee (FEZ Planning Office) draws up polices while local governments (FEZ Authorities) pursue FEZ development and attract foreign investment.
FEZ development proceeds in the order of "designation-development-investment procurement."
- (Designation) FEZ Committee confirms development plan drawn up by municipal & provincial governments
- (Development) Zone development and formation of living environment
* Zone Development 1. Select developer, 2. Devise implementation plan, 3. Groundbreaking
* Formation of living environment: Create a foreigner-friendly living environment (education, medical care, housing and culture)
- (Investment procurement) FEZ Authorities attract companies and research centers according to development concept
FEZ Development
- Deregulation and policies to support development projects
- - Limit on building coverage ratio and floor area ratio may be eased within the range of 150/100
- - Greater leeway in the use of sports facilities sites
- - Farmland diversion is possible with mayoral or gubernatorial approval (no need for approval from Minister of Food, Agriculture, Forestry and Fisheries)
- - Upon approval of implementation plan, approximately 72 types of approval, consultation and reporting procedures are deemed as being completed
- - Granted the right to expropriate or use land
- - Roads, water supply/sewage systems, electric and communication facilities may be built by parties other than the site developer
- - Reduction or exemption of taxes and charges
- Check the FEZ Act and other related laws for details.
