Experts discuss Megacity Seoul, balanced development in roundtable meeting

From right Huh Mun-gu, head of the Center for Balanced Regional Development at the Korea Institute for Industrial Economics & Trade, Lee Cheol-woo, governor of North Gyeongsang Province, Woo Tong-ki, chairman of the Presidential Committee for Balanced National Development, and Chu Hyun-ho, chief executive officer of QUIETIME Dream Lab. [Photo by Lee Chung-woo]

Megacity Seoul will become a catalyst for the creation of super-regional economic zones across the country, according to Woo Tong-ki, chairman of the Presidential Committee for Balanced National Development in South Korea.

“The expansion of the capital area is not a zero-sum game, but an opportunity to enhance regional capabilities,” Woo said, during a roundtable discussion organized by Maeil Business Newspaper in Seoul on Tuesday.

The discussion, which was held to explore the direction of Korea’s balanced regional development, was attended by four experts – Woo, Lee Cheol-woo, governor of North Gyeongsang Province, Huh Mun-gu, head of the Center for Balanced Regional Development at the Korea Institute for Industrial Economics & Trade, and Chu Hyun-ho, chief executive officer of QUIETIME Dream Lab and member of the Presidential Committee for Balanced National Development.

The experts agreed on the need for a mega city, which has recently become a hot issue in politics.

“The concept of super-regional economic zones surfaced during the Lee Myung-bak administration, but it failed to make headway,” Woo said. “By utilizing mega cities well, rural areas can enhance their capabilities and achieve super-regional economic zones quickly, moving towards administrative integration.”

The super-regional economic zones mentioned by Woo are a core part of a comprehensive plan for the regional era unveiled by the Yoon Suk Yeol government on November 1.

The plan aims to bind regions facing a crisis of extinction due to population decline into regional blocks to achieve regional development through economies of scale.

Currently, seven regions have expressed interest in participating in the regional cooperation project – Chungcheong Province, Gwangju-South Jeolla Province, Daegu-North Gyeongsang Province, Busan-Ulsan-South Gyeongsang Province, Gangwon Province, North Jeolla Province, and Jeju.

North Gyeongsang Province Governor Lee agreed that the plan for Megacity Seoul aligns with the concept of super-regional economic zones.

“Megacity Seoul can compete with cities like London and New York and we can create mega cities also in other areas of the country,” Lee said.

Local autonomy was highlighted as the most important factor in opening the regional era. The concept means that local governments, which are the most familiar with local realities, can play a crucial role in the development of the region. “There is nothing that local areas can do on their own, including personnel management and education,” Lee said, emphasizing the need for the central government to give discretion to local governments to promote regional development.

“The proposed opportunity development special zones will prompt a competition between local governments in terms of creating ordinances,” highlighting the importance of creating the best ordinances to attract businesses.

Last month, the government unveiled a plan to strengthen local governments’ autonomy and legislative powers, including a significant delegation of local affairs to ordinances.

If local autonomy works well, local areas will be able to retain their own identity, the experts said.

Education is also the key to revitalizing regions. “We need to create specialized universities in each region so that people born in a region can study, work, and live in that region,” Lee said.

Various tax benefits to attract businesses and talent are also crucial.

“Although the government has put forward a number of policies, the enactment and revision of related laws has been slow,” Chu said.

“In the case of corporate taxes, it is worth considering a system that differentiates them according to the level of regional development, exempting 100 percent of corporate taxes for the first 10 years and then reducing them by 50 percent for the next 10 years,” Huh said. “Benefits such as inheritance tax reduction should also be given to companies relocating to local areas.”

He also raised the need for a reduction in earned income tax as an incentive for workers employed by companies in local areas.