Factories to be allowed in former ‘green belt’ areas

The government announced Wednesday that it will allow construction of commercial facilities and factories in areas freed from “green belt” development restrictions.

The former green belt areas around Gimhae International Airport, Gwangju, and Changwon are expected to be developed following the announcement, helping the recovery of the regional economy.

These are part of measures unveiled by the government to promote the regional economy. The measures focus on deregulation and support for regional governments. The measure is expected to generate 14 trillion won in investments in the provinces.

The most notable part of the plan is deregulation on former green belt areas.

The government has green belt zones around big cities, where construction is restricted to prevent reckless expansion of the urban areas.

These areas, however, have been the target of complaints by locals, as they hamper regional development.

The government thus has been freeing some of the green belts one by one, but they were not developed because only homes could be built there. There were 1,530 square kilometers of former green belt zones subject to such restrictions as of the end of last year.

As the government will allow construction of commercial facilities and factories in such former green belt zones, areas around Gimhae International Airport, Gwangju, and Changwon are expected to be the first to benefit.

In the case of the area around Gimhae Airport, only homes could be built there even though it was freed from the green belt zone. Hence, there were no commercial facilities built there despite a huge demand from tourists. In the case of Gwangju, there have been complaints by automobile businesses that there is no room to build a factory.

The measure follows President Park Geun-hye’s continuous demand for deregulation to boost the economy. She recently said that unnecessary regulations are “cancers killing our body.”

Balanced growth around the country has also been a primary task for the government, as regional economies have been shaky while there has been a concentration of capital and resources in the metropolitan area.

A lack of job opportunities, low incomes and the declining population are chronic problems of the local economy. For instance, while industrial output grew by 4.9 per cent in Seoul and the metropolitan area last year, Jeolla Province saw 4.3-per cent decrease, and Daegu and North Gyeongsang Province fell by 6.2 per cent.

The government determined that inducing corporate investment is key to reviving the regional economy, and found the answer in deregulation.

It said that the regional governments will present concrete plans for region-specific projects to boost the economy, which will be supported by the central government.

Busan, for instance, plans to specialise in visual industries, while Daegu will set up a software cluster. Incheon plans to become service industry hub, and Gwangju aims at nurturing the culture and contents industry. The government said it will examine the plans by the regional governments, to provide financial and regulatory support.  

“The plan is meaningful as the project leadership will shift from the central government to the local governments. The government will provide support packages, including financing and deregulation,” said Jung Eun-bo, deputy prime minister of the finance ministry.

The government also plans to provide bigger incentives for businesses moving to provinces or investing there, which include tax cuts and exemptions from some regulations.

Urban industrial complexes will be built in Incheon, Daegu and Gwangju, and old industrial complexes in cities like Gumi, Ansan, Chuncheon, Jinju, Yeongam and Changwon will be remodeled.

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