Thursday, May 8, 2008

7 zones

LEE Myung-bak's government is facing big hurdles these days but at least something seems relevant : grouping provinces and big cities around 7 economic zones, and accelerating bullet train projects at the national level. I hope this won't alter the "cluster" approach but boost each region.

The 5 major zones will be :

- Central metro : Seoul + Incheon + Gyeonggi-do - major : finance & hi tech
- South East : Busan + Ulsan + Gyeongsangnam-do - major : heavy industries
- Daegu / Gyeongbuk : Daegu + Gyeongsangbuk-do - major : electronics, textile, energy
- Chungcheong : Daejeon + Chungcheongnam-do + Chungcheongbuk-do - major : science, R&D, education
- Gwangju / Jeolla : Gwangju + Jeollabuk-do + Jeollanam-do - major : tourism

Two provinces remain on their own :

- North East : Gangwon-do - major : tourism and medical
- Jeju : Jeju-do - major : tourism

Not a dramatic change for Jeju but some hope for Gangwon, now a segment of one potentially more advertized overseas. Splitting Gyeongsang is an even smarter move. Jeolla remains untouched and focused on tourism, but a "Sun Belt" Economic Zone is also planned from Mokpo to Busan along the South Coast in order to rival Seoul and accelerate the demographic and economic development of Mokpo area. Top chaebols will be invited to open vice-national HQs in the new zone. Preferably not in the Busan area, already a major hub by itself.

If new administrative levels could limit the intranational competition between self proclaimed Asian hubs, they are not necessarily good news - poorly handled they would even destroy value everywhere. I also suspect some potential cannibalization / coopetition with Korea's existing cluster strategy.

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