No Limit on Enterprise City Numbers

Starting this year, enterprise cities will be selected without any limit in number, and development incentives for participating companies will be expanded.

However, some point to possible land price increases resulting from relentless development and say it is a “pork-barrel” measure suggested with the May 31 local elections in mind.

The Ministry of Construction and Transportation (MOCT) announced Monday that all enterprise city development plans submitted by local governments other than those of the Seoul metropolitan area will be accepted after they pass the deliberation of the Enterprise City Committee (chairperson Prime Minister).

The measure will be implemented starting in the second half of this year.

The newly announced measure is a deregulated form of what the MOCT announced last year when it selected six enterprise city pilot projects in Muan of South Jeolla Province, Cheongju of North Chungcheong Province, Wonju of Gangwon Province, Taean of South Chungcheong Province, and Haenam and Yeongam in South Jeolla Province. Back then, the ministry said it would “select one or two enterprise cities each year.”

In order to elicit participation from the business community, the ministry also decided to adopt measures to expand government support for basic facilities such as water facilities and roads in the surrounding areas of selected enterprise cities, while also cutting some of the “farmland preservation fees.”

Moreover, the ministry decided to allow companies to submit enterprise city applications at any time.

There are a total of 16 local governments now preparing to build enterprise cities. There are 10 tourism-leisure type cities under development and six industry-trade type cities including Sacheon and Hadong of South Gyeongsang Province and Gwangyang of South Jeolla Province, cities that lost the bid last year.

Lee Bang-ho, chairperson of the Grand National Party policy committee, said, “Last year, serious fights broke out between regions with selected enterprise cities. In this situation, the government has once again set forth a policy targeting the local elections. Relentlessly selecting enterprise cities could lead to unabated development that will increase real estate prices. The GNP is preparing necessary response measures.”

To this, a source in the MOCT said, “The Special Law on Enterprise City Development does not set a specific limit in the number of enterprise cities that can be developed. We will conduct strict deliberation. If there are dangers of a relentless development following pork-barrel election promises by local governments, we will limit the number.”

Joong-Hyun Park Jung-Eun Lee sanjuck@donga.com lightee@donga.com