The government is pushing a plan to create "mega special zones," saying it will concentrate on fostering specific industries or functions at the metropolitan level. There are already 2,437 special zones designated nationwide. With 243 local governments nationwide, that works out to an average of 10 special zones per local government.
Experts said, "Before creating mega special zones, it is necessary to restructure the overlap and excess of existing special zones." But with local elections next year, there are projections that it will not be easy for the government to restructure the special zones.
◇ More than 100 special zones in Busan alone… Mega special zone consultative body "reviewing operation linked with existing special zones"
According to a compilation of ChosunBiz reporting on the 22nd, the Office for Government Policy Coordination under the prime minister held the first meeting of the "Mega Special Zones 5 Axes 3 Specials Consultative Body" on the 18th. The core of the mega special zones is large-scale regulatory innovation and policy package support premised on inter-regional cooperation at the metropolitan level.
The consultative body is said to be discussing ways to operate mega special zones in consolidation with existing special zones. A prime minister's office official said, "Rather than reorganizing or consolidating existing special zones, we are reviewing ways to link them with mega special zones."
If such a plan is finalized, critics say it will be difficult to resolve the problems of overlap and excess in special zones. As of early this year, special zones and industrial clusters operated by 11 ministries span 87 systems, with 2,437 designated areas. Given that there are 243 local governments nationwide, each local government holds an average of more than 10 special zones.
In particular, Busan has more than 100 special zones and industrial clusters. The two special zones during the Kim Young-sam administration surged to more than 50 under the Kim Dae-jung administration. After that, 17 were added under the Roh Moo-hyun administration, and about 10 each under the Lee Myung-bak and Park Geun-hye administrations. Around 20 more were newly designated under the Moon Jae-in administration, and special zones were also designated under the Yoon Suk-yeol administration. As a result, the total area designated as special zones across Busan amounts to 2.4 times the city's area. There are as many as 12 areas where special zones overlap.
◇ "We need to review and reorganize the performance of existing special zones"… "Restructuring special zones will be difficult ahead of next year's local elections"
Experts point out that reorganization of existing special zones should precede the push for mega special zones. Lee Bu-hyeong, director at Hyundai Research Institute, said, "Even when similar special zones exist in adjacent areas, linkage and cooperation often do not occur, and vacancies are increasing even in established national industrial complexes," adding, "For mega special zones to succeed, it is necessary to review the performance and limitations of existing special zones and go through a reorganization process."
The Presidential Committee on Policy Planning also announced in Sep. that it would "gradually reorganize the proliferating special zones." Earlier, in Feb. this year under the Yoon Suk-yeol administration, the Ministry of Economy and Finance also said it would "reorganize special zones."
However, there is no visible control tower to handle the restructuring of special zones. An Office for Government Policy Coordination official said, "It is difficult to view the Office for Government Policy Coordination as the control tower for reorganizing special zones," adding, "This is a matter on which each ministry must offer its views." A Ministry of Economy and Finance (MOEF) official also said, "We are focusing more on reducing wasteful fiscal expenditure than on reorganizing special zones." An official at the Presidential Committee for Balanced National Development said, "We have no legal authority over special zones."
An official at a ministry operating special zones said, "It is difficult to eliminate them easily even if they are similar or overlapping because tax, fiscal, and special exception benefits are intertwined in existing special zones," adding, "It will be especially hard to endure backlash from local residents ahead of the June local elections next year."
An official at a local government also said, "If the government or the ruling party is thinking about the local elections, it will be difficult to bring the issue of restructuring special zones into public debate at least until the first half of next year."