Gyeongsangbuk-do is embarking on a major investment paradigm shift
On the 25th, Gyeongsangbuk-do announced the “Gyeongsangbuk-do private investment revitalization strategy” using ‘investment fund’.
Gyeongsangbuk-do made ‘private investment revitalization’ one of the pillars of this year’s provincial management direction, and on the 26th of last month, it launched the first regional revitalization fund project among cities and provinces across the country to build a 500-room worker dormitory in Gumi Industrial Complex 1.
The ‘investment fund’ is operated in a way that the public invests priming funds in large-scale projects needed in the region, and the private sector invests capital to pursue public interest and business feasibility at the same time.
An official from Gyeongbuk Province said, “For the lack of business feasibility of private investment projects, profitability can be secured by investing additional financial projects in areas where public interest is required.” “If you designate it as a center and use it for a certain period of time every year, the profitability of the business will increase and investment will increase,” he said, giving an example.
◈ Announcement of selection of 4 key areas projects and 5 strategic tasks to support
Gyeongsangbuk-do’s “Private Investment Revitalization Strategy” announced on this day includes “four key areas projects” and “five strategic tasks” to support them, with the goal of attracting 10 trillion won in private investment by utilizing “investment funds” by 2026. The goal is to implement large-scale projects that will completely change the landscape of the region.
The four major private investment projects in Gyeongbuk are ▴medical welfare, ▴cultural tourism, ▴agriculture, and ▴industrial infrastructure. Although investments are necessary for local cities to function properly, the budget is insufficient to carry out financial projects, and it is not feasible to pursue them with private capital alone. It was an area that was experiencing difficulties due to lack.
An official from Gyeongsangbuk-do Province mentioned that the first Regional Revitalization Fund project, which was launched this time, was originally planned to be around 15 billion won, but when combined with a policy fund, the scale increased to 123.9 billion won and was designed to be used by large corporations in the Gumi Industrial Complex.
◈ Private sector-led medical transformation, fostering service industries such as 1 city, 1 hotel, etc.
In order to improve the level of medical welfare, a plan was also announced to overcome the metropolitan area-centered medical system by introducing heavy ion therapy devices and modernizing public medical center facilities, while attracting unique hotels in each city and county to create a city where people want to stay.
In fact, there were many criticisms that tourism infrastructure was lacking on the east coast of Gyeongbuk, as there were almost no hotels above 4 stars. Gyeongbuk Province launched the first regional revitalization fund project this year and focused on policies to stimulate private investment, and it is understood that there is a lot of interest from the hotel industry and asset management companies in Andong and Mungyeong as well as the East Coast.
◈ Expect great changes in the overall industrial structure, including agriculture
With private investment, great changes are expected in all industrial fields, including agriculture. The plan is to innovate smart farms and agricultural product distribution infrastructure, which have been promoted mainly with public finances, by creating a smart farm town using private capital and creating an agricultural product distribution and logistics center in which large distributors participate.
In the case of smart farm towns promoted by the private sector, crops to be cultivated are decided in advance and food companies or distributors are selected.
It is reported that the business will be promoted after confirming the purchaser, including the buyer.
In addition, the dormitories for industrial complex workers launched with the first fund are planned to be expanded by adjusting the size according to demand as there is demand not only in the Gumi industrial complex but also in other regions, and the energy infrastructure expansion project in the east coast area is also a project eligible for the ‘investment fund’. will be promoted.
◈ Presentation of five major strategic tasks, including creation of Gyeongbuk’s own fund worth 100 billion won
Gyeongbuk Province presented funding, organization, human resources, systems, and governance as five strategic tasks to realize key tasks. First, we plan to secure 100 billion won in funds by the end of the year to create our own fund, the ‘Gyeongbuk Private Investment Revitalization Fund’. It is designed with a structure in which finance and private finance each invest 50%.
◈ A new dedicated organization is also being established as a strategic department to revitalize private investment.
We also plan to have a professional organizational system and manpower dedicated to private investment. In order to strengthen the private investment planning and operation function, we plan to reorganize the organization by establishing a new ‘Private Investment Activation Department’ and operate it from July. As the task is to apply financial techniques to private investment, we will hire financial experts and hold investment briefing sessions. , it was decided to establish a permanent consulting system by forming a working group of experts in each investment field.
We will also take the lead in creating an institutional framework, such as laws and ordinances, that will lead to the revitalization of private investment. Proposed to the 22nd National Assembly the ‘Special Act to Support Regional Private Investment Activation’ that clarifies the basis for local governments’ fund investment and reflects menu-type regulatory special provisions to induce legislation, while also promoting the ‘Gyeongsangbuk-do Province’ including prevention of disputes over preferential treatment and operational direction. We plan to enact the ‘Private Investment Promotion Ordinance’ and disseminate it to cities and counties.
It is also expected that it will serve as a driving force to change the local industrial ecosystem with a new governance system in which the public and private sectors cooperate. For continued private investment, we plan to cultivate talent in related industries by collaborating with local universities. If the private sector invests in smart farms, a ‘Smart Farm Department’ will be established at the local city/county university, and a hotel management/resort department will be established to expand hotels and resorts. This is a method of expanding the ecosystem of the overall industry by signing a talent training agreement with the Department of Tourism.
◈ Vitalizing private investment and bold challenges to change the local landscape
Meanwhile, the reason why Gyeongsangbuk-do is putting all its efforts into ‘vitalizing private investment’ is because it believes that existing financial projects cannot change the local landscape.
Emergency measures are needed to prevent local cities from disappearing, because existing financial projects take a long time to secure budgets and advance administrative procedures, making it difficult to overcome the urgent reality of local extinction.
It is also a welcome reason for Gyeongbuk-do to introduce a new policy tool through the central government’s ‘Regional Revitalization Investment Fund’ at the same time.
Meanwhile, North Gyeongsang Province Governor Lee Cheol-woo has emphasized that “attracting private investment is essential to change the local landscape,” and “let’s support the public role as much as possible and allow local governments to lead their own administration.”
Reporter Oh Gyeong-mook
Tags: Gyeongbuk Province seeks attract trillion won private investment projects investment funds
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