DGFEZ Authority Commissioner Choi Byung-Rok

By Oh Chung-sook

The Daegu-Gyeongbuk Free Economic Zone (DGFEZ) has decided to make the year 2014 the first year for making a quantum jump in attracting foreign direct investments (FDIs) in order to ride on the momentum it gained in 2013. 

DGFEZ has made a strong showing in luring FDIs as it attracted $130 million in 2013 on an MOU basis. In terms of FDI arrival , it chalked up $68 million, a 62 percent surge from $42 million in 2012. Seven foreign companies, including LFJ Korea and BPH Korea with which DGFEZA signed MOUs in 2013 account for just less than half of the 15 foreign investors it has attracted so far since its establishment five years ago. 

DGFEZ also attracted 32 Korean companies whose combined investment amounts were estimated at 240.6 billion won in 2013. The Korean occupants of the FEZ include Daejoo Machinery, Samick Precision, and Daesung Hi-Tech. DGFEZ aims at luring more than $100 million worth of FDIs this year by establishing elaborate strategies to overcome uncertainties caused by the global recession and Japan’s low yen. 

Choice & Concentration

IT convergence, advanced transportation/machinery parts, and advanced medical arenas have been designated as the DGFEZ’s top three major target sectors by the central government in accordance with the 1st Free Economic Zone Basic Plan, established last July. The DGFEZ Authority is currently focusing on these three major sectors. At the same time, it will try to focus on the business sector and areas of IR activities with high potential to raise IR efficiency by analyzing the 142 overseas IR sessions the DGFEZ authority held since its founding through Matrix Analysis. 

Since its establishment, the DGFEZ Authority has largely collaborated with KOTRA, the largest investment-attracting consulting institute in Korea, as its major partner. The authority currently has business links with global consulting institutes such as Oxford Intelligence, and it plans to further diversify the providers of consulting services in 2014. 

Meanwhile, the DGFEZ Authority continues to seek out local companies that want joint ventures with foreign companies whose investments cover more than 50 percent of their total investment in the DGFEZ. If necessarily, the authority will hold a joint overseas IT session with local companies so as to provide more opportunities for foreign companies to invest in the DGFEZ, thus raising the efficiency of IR activities.

Souped-up network with foreign chambers of commerce and foreign embassies

The DGFEZ Authority will continue to strengthen its relationship with the U.S., Canadian, French, German, Swedish, and Australian chambers of commerce in Korea, with whom it has already built cooperative ties. The authority plans to seek to implement collaboration projects with the French Embassy, the Swiss Embassy, and the Israeli Embassy in Korea.

Additionally, the DGFEZ Authority plans to flesh out a detailed procedure for collaborating effective investment attraction with the Nuremberg Chamber of Commerce in Germany, Zone Corp. in the United Arab Emirates, and the European Free Zone in Turkey, with whom the authority has already concluded an MOU. 

DGFEZ Authority Commissioner Choi Byung-Rok, said, “Even though investment attraction environments in Korea are not favorable right now due to the global economic recession, the continuing depreciation of the yen, and persistence of North Korea risks, we will let foreign investors know about the FTA advantages of the Korean economy and our local economy’s comparative advantage, etc., and achieve remarkable outcomes in terms of foreign investment attraction. 

“We will focus on the foreign investment attraction not just on quantitative aspects, but also on qualitative aspects, with local R&D institutions playing a key role for the cluster behind the growth engine of the local economy and consequently maximizing its potential,” he said.

Commissioner Choi went on to say, “Especially as both the Suseong Medical District and Gyeongsan R&BD District, which once suffered the difficulties of district development, is now picking up speed for development, we are doing our utmost efforts to make 2014 the first year of making a quantum jump of attracting investments.”