Direction of Territorial Policies for Strengthening Inter-City Linkages

The Three Northeast Asian countries need to lay down the physical foundation for economic cooperation. Specifically, they should share their common interests to create an open economy. Korea’s territorial policies should take the lead.

As a hub of economic cooperation and exchanges, Korea should establish models to maximize its comparative advantages.

Development of key areas for economic cooperation: Common key areas (strongholds) for exchanges should be spatially allotted.

Seoul and Inchon shall be nurtured as key areas with outstanding competitiveness in the capital region. The same goes for Pyungtaek, Dangjin, and Ahsan in the Yellow Sea Free Economic Zone.

Semangeum, Muan, Yeosu, and Gwangyang in the Jeon-Buk and Jeon-Nam regions

Busan and Ulsan in the southeast region

These areas should be developed by connecting with various types of major economic cooperation areas such as existing free economic zones, tariff-free zones, and free international cities.

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Free economic zones can serve as the foundation for self-sufficient regional development. Likewise, development points with low to moderate entry barrier should be nurtured in free trade zones, tariff-free zones, and free international cities for linkages with free economic zones.

The development of major areas for infrastructure and resources development necessitates mutual cooperation on expanding infrastructure for exchanges and cooperation. This way, environmental and economic cooperation can be fostered.

Institutional infrastructure should be reorganized in preparation for the expansion of trade and investments in intra-regional countries. The physical infrastructure should also be constructed to expand the logistics and traffic sectors.

Common countermeasures of intra-regional nations for environmental issues such as GHG emissions after the Kyoto Protocol and serious issues such as yellow dust

Broad regional zones such as the Pan Yellow Sea Zone, Pan East Sea Zone, and Japan-Korea Strait Zone are established. Through these, regional development cooperation in Northeast Asia is expected to be fostered by phase and stage. Cooperation within these cooperation zones should be realized first.

Inter-city linkages and cooperation in each region should be strengthened focusing on port cities. Cooperation should also be expanded.

The internationalization of industrial regions having linkages with free economic zones and the advancement of their industrial structures should be supported. For regional internationalization in particular, specialized growth points with low to moderate entry barrier should be developed.

Cities and regions are considered more realistic and practical spatial cooperation units than nations. Thus, cooperative development by large cities and regions in each economic zone should be utilized as major tools for cooperation in Northeast Asia.

Seoul shall be developed as a core economic city connecting BESETO. Specifically, it shall be nurtured as a competitive financial hub.

The Inchon Free Economic Zone shall also be developed as a business hub in Northeast Asia, the Busan and Jin-Hae Free Economic Zone, as a marine logistics hub, and the Gwangyang Free Economic Zone, as an international logistics and production hub.

Logistics centers for export industries in the west coast region shall be nurtured, focusing on the Gunsan Free Trade Zone, Gunjang National Industrial Complex, Semangeum, and Muan Enterprise City.

As tariff-free zones, Busan Port, Gwangyang Port, Inchon Port, and Inchon International Airport shall be actively nurtured into international logistic hubs.

The Jeju Free International City shall strengthen its international exchange functions by establishing tourism infrastructure such as leisure complexes, cruise industry, and convention industry. It shall also develop a high-value air logistics industry connecting international and national ports and set up an offshore financial center to attract international financial institutions. This can serve as a long-term strategy for the city’s growth as a complex/free international city where logistics and finance are combined.

Strategies should be linked with the creation of region-wide economic zones that have recently been proposed as a new framework for territorial policies.

This way, they can develop into those connecting with sub-regional zones in Northeast Asia. The internationalization of specialized industrial regions as well as the advancement of their industrial structures will also be realized.

In addition, local policies for the development of specialized hubs with low to moderate entry barrier should be actively supported. This in turn will facilitate the internationalization of local areas. As such, institutional complementation is necessary.

Creation of advanced environment for employment generation:

The creation of advanced living environment such as housing, education, and medical services as well as a spatial/physical

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environment shall be complemented and supported.

Specifically, an advanced corporate environment in terms of labor-management relations and finance shall be created.

A comparatively favorable investment environment should be created vis-à-vis foreign special zones. Long-term stay for foreigners should also be allowed for the internationalization and opening of labor market. Moreover, liberalizing the movement and transaction of goods requires the designation of free zones. Finally, the movement of capital and liberalization of investment should be promoted after consulting with related ministries.

5. Role of Local Governments in Promoting Inter-City Linkages and