In South Korea, more than three-quarters of the factories that were closed or shut down within the past five years were concentrated in Seoul and Gyeonggi, and the amount of budgetary support for these plants was skewed toward non-metropolitan areas, even though the number of closed and shuttered companies in national industrial parks was much higher in the capital region.

A recent analysis of data related to the opening and closing of businesses in the country’s national industrial complexes revealed a significant disparity in government support between the capital region and non-capital regions.

According to data obtained by lawmaker Chung Il-young from the Democratic Party of Korea, a total of 2,587 businesses in national industrial complexes have closed their doors over the past five years abd among these, 1,988 were in the capital region while 599 were in non-capital regions.

The government has been implementing the Industrial Complex Structural Enhancement project, which aims to revamp industrial complexes by using closed or inactive factories facilities to enhance cultural, welfare, and convenience facilities in these areas. The project allocates a budget of at least 1 billion won ($750,000) to a maximum of 7 billion won for each factory. But government support for the capital region is limited to a maximum of 40 percent of the total project cost, while non-capital regions receive up to 70 percent.

The data also indicated that the proportion of projects in the capital region within the total project count is relatively low. As of August 2023, the number of ongoing remodeling projects has significantly decreased to just two, compared to seven in 2022. In 2019, out of a total of nine project locations, only two were in the capital region, there was only one capital region project out of three in 2020 and 2021, and in 2023 to date, just one out of nine total projects was in the capital region.

By Kim Dong-eun and Minu Kim

[ⓒ Pulse by Maeil Business News Korea & mk.co.kr, All rights reserved]