Field Report

Field Trip to IFEZ

Rai Mira
Student ID no: 201975101

Submitted on: December 13, 2019

Submitted to: Prof. Park Yong Jun

 Table of Content:

S.N CONTENT PAGE NO.

1 Introduction. 3-5

2 Objectives 6

3 Methodology 7,8

4 Findings 9,10

5 Discussion 11

6 Conclusion 12

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1.Introduction:

As a consequence of the 1997 economic crisis in Asia, Korea introduced stronger, more market-
oriented economic restructuring policies and has since successfully recovered from the economic
difficulties that resulted from International Monetary Fund (IMF) control. However, along with the post-
crisis economic restructuring, Korean leaders recognized that the traditional manufacturing could no
longer guarantee stable economic growth. They needed to come up with a new engine of development for
the economy of the future. Thus, Korea’s national government started the Northeast Asian countries
business hub project in April of 2002. So, Free Economic Zones were created to attract more Direct
Foreign Investment in accordance with the Free Economic Zone Law in 2004.

Free Economic Zone:

The Free Economic Zone is an area designated by ministry of Trade, Industry and Energy to facilitate
foreign investment by ensuring the economic and business activities along strengthening national
competitiveness and seek balanced development among regions for improving the business environment
for foreign investors by providing them the necessary system and living conditions.

In other words, Free Economic Zone is designating for inducing foreign investment by improving the
business and living conditions of foreign-invested businesses. Attracting not only foreign-invested
companies (manufacturing, logistics), but also medical institutions, educational institutions, foreign
broadcasting stations, financial institutions, etc.

The Purpose of Free Economic Zone are to promote or appeal foreign investments, providing financial
assistance, taxation support, liberal activity, high administrative services etc. Furthermore, assuring and
improving the comfortable living environments for foreign investors.

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Incheon Free Economic Zone (IFEZ):

IFEZ covers mainly three International cities that are Songdo, Yeongjong and Cheongna including
Incheon International Airport/Ports taking advantage of geographical merits and as the hub for
government’s strategy of making North East Asia’s economic central by welcoming regional
headquarters of multinationals and build up international logistic business-related enterprises.

• International city: offering a convenient living environment in addition to free economic

activities
• Location - In west coast of Korea, adjacent to Seoul (appox.50km from downtown Seoul) -
Bridge role between China and Japan, 1 or 2 hours away from Incheon
• Total area: 123.65 sq.km
• Expected population: 539,000 people
• Period of project: 2003 – 2020
• Development costs: W81.5 trillion (approx.$74 billion)

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IFEZ Global Centre:

IFEZ Global Center also known as G-Tower which is run by the Incheon Free Economic Zone Authority,
is a comprehensive support center for foreign residents in IFEZ. IFEZ Global Center is dedicated to
provide a trouble-free life for the foreign residents in IFEZ.

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2.Objectives:

As Leadership and Ethic Workshop student we visited Incheon Free Economic zone (IFEZ) as
our 2nd field visit trip on Friday,15th November, 2019. The purpose of our visit is mentioned below:

1. To get information about the Free Economic Zone of South Korea located in Incheon

Metropolitan Area.

2. To observe their location and well-equipped infrastructures.

3. Another purpose of our visit is to gain experience of the Free economic zone and smart city by

taking trip to the IFEZ and G- Center Tower.

4. To gain knowledge about the purposes and take a glance on the services and operations of IFEZ to

the foreign investors.

5. To experience the Smart City of IFEZ and also ascertain their development plan.

6. To acknowledge the weakness and the strength of FEZ in South Korea.

7. Sightseeing and enjoy around the city.

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3. Methodology:

As our field trip was one day visit to Incheon Free Economic Zone (IFEZ) on 15 th November,
2019. We departed for Incheon from our University with LEW students in 10:30 am at the morning. We
took the bus to the Incheon and it took around 1 hour to reach our destination. The weather though was
not supporting as it was raining a lot but still we were really excited to get to our destination. After
travelling from bus for an hour we reached to our destination and our bus stopped in front of the Global
Centre Tower in Songdo International City. We stepped inside the building of the Global Centre Tower
and waited for our interpreter.

After waiting shortly our interpreter arrived and she took us to a tour inside the building of Global Centre
Tower. At first, we visited the 33rd floor IFEZ History Centre our interpreter took a while explaining us
about the History of Incheon and the development along their achievements till today in brief. We
observed the images that gave us short glimpse of the history of that place which made us feel nostalgic
yet became eager to know more about the South Korea’s milestone of development and progress. It
clearly portraits how diligent and prodigy Korean people are to gain the development in short period of
time.

After that we visited the IFEZ Vision Centre, exhibiting the past, present and future of the IFEZ,
displaying the development process, plans and business progress. We also got an opportunity to watch the
3-sided media video and simulation experiences that use cutting-edge exhibition facilities that help us and
other visitors for learning.

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The halls also offered panoramic views on all four sides on all four glass walls that display the entire city
of Songdo International City.

Moreover, we visited “The Smart City Operation Centre” on the 4 th floor of G-Tower which has an
integrated control system to check every corner of the city. It also manages daily security, safety,
transportation, environment and facilities at the same time, and this system allows discovery and measure
of abnormal circumstances in advance and immediate handling of civil complaints.

After visiting around for a while, we went to the cafeteria which was on 29th floor and had the lunch
break, a short break. The lunch they provided was like homemade food, very delicious and very hygienic.

After the lunch break as per the schedule we were supposed to visit the Sea Water Park at Songdo Central
Park for riding Water Taxi but unfortunately due to weather as it was raining and cloudy we were not able
to visit that place but instead we just take a short tour around the locality through bus and then our short
trip ended when we get back to our university. Though it was short trip it was very informative and
enthusiastic. I enjoyed a lot and felt privileged to visit such a spectacular and outstanding advance
integrated city with smart technology which makes them as one of the global business frontiers and the
center of the economic bloc of North East Asia.

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4. Findings:

After visiting the Incheon Free Economic Zone (IFEZ) area I acknowledged the overview of Free
Economic zone of South Korea as in 2003, the government, ruled by new president, announced the
Northeast Asian economic hub country plan as an important agenda. As a means of coping with the
changing global environment the Korean government designated Incheon in 2003 as the country’s first
Free Economic Zone (FEZ) ahead of those later located at Busan and Gwangyang Bay in the south of the
country. There has been the designation of 8 free economic zones including Incheon Free Economic
Zone. As my findings free economic zone is an area that ensures the economic and business activities of
foreign investors by providing them the necessary system of conditions.

The free economic is an international business city and its major incentives are:

 Tax reduction and exemption:

* National tax: equal to the foreign investment ratio for the first 5 years and 50% of the ratio for
the following 2 years.
* Local tax: exemption for 15 years

 Exemption or reduction of land rent: 50-100% according to the determination of the managing
authority.

Another significant finding is about the Incheon Free Economic Zone (IFEZ) which is one of the dynamic
8 economic zones of South Korea. The IFEZ has been exemplary, advanced high-tech global business
frontiers established in August 2003 over three international cities Songdo, Yeongjong and Cheongna.
The three zones each promoting the distinctive development strategies based on its own unique
characteristics and advantages.

Songdo International City the center of high-tech knowledge and service industries in IFEZ has modern
architectural components present the refined skyline of a futuristic city. Inside the city there are pleasant,
attractive and advanced high-tech locations:

 Songdo International Park which embraces the fullness of nature in the midst of a forest of high-rise
buildings. This city has established as the sea water park that visitors can enjoy and do various water-
based activities.

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 Another interesting place is Songdo Hankok Village which has Korean traditional style houses
standing out in pleasant contrast to the modern buildings. There are many Hankok hotels around the
area that visitors can enjoy.

 G-Tower is situated at center of the city, home to the IFEZ and international organizations like GCF
and the UN. IFEZ Global Center is dedicated to provide a trouble-free life for the foreign residents in
IFEZ and hope to ease the challenge of living in a foreign country by providing a wealth of
information and services. They also welcome newcomers from diverse nationalities. Inform expats
about tips on daily living. Advise about administrative services, legal, immigration, education, labor,
business, tax and real estate related matters. Connect foreigners in IFEZ to relevant offices that may
respond to their needs and special requests. Organize educational courses and cultural exchange
programs. And it’s all available out of cost.

 Daily living Support Services: IFEZ global center helps to deal with the inconveniences and
problems foreigners may face during their stay in IFEZ. Their services related to it are One
stop consultation services and Interpretation Services.

 Programs and Events: Events in IFEZ and its surrounding region to promote the integration of
foreigners in the community. Updates about event through our website by distributing
materials and sending emails in English to the foreign residents of IFEZ. Some of their
programs and events includes; Traditional Cultural Experience Program, IFEZ lunchtime
orientation, Special Buddy Program and Ticket Box Office.

 They also provide Korean Language classes in free of charge.

Yeongjong International City the complex city of tour and leisure is located in proximity of the
world best Incheon International Airport, whose existence in itself adds excitement, the area boasts
new concepts for complex resorts and entertainment facilities as well. The best place of aviation
logistics, tour and leisure with the world-class international airport.

Cheongna International City the new mecca of global financial industry is also known as The
Venice of Korea with Lake Park crossing the city at its center, waterways extended in all directions,
effectively spreading different tastes, flavors and joys. Therefore, it is the place of new concept
business town with harmony of business, residence and industry.

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 Hence the three zones of the IFEZ are leading the economic growth of Korea individually and
together at the same time.

5. Discussion:

As IFEZ is an outstanding, exemplary global business frontier though it has advance and high-tech
cities that attracts foreigners to invest but still there are many issues that IFEZ has its own strength
and weakness which I am going to discuss below:

About its strengths, IFEZ provides lots of opportunities and services to the foreigner investors and
also provide suitable comfortable living conditions that is safe and advance. Inspite of this other
strength of IFEZ is mentioned below:

 Firstly, Incheon has many advantages that are ideal for establishing a free economic zone due to
its geographical with competitive seaport and an airport.

 Second, Incheon is near to Seoul so it is well organized social overhead capital.

 Thirdly, Korea has competitive market and seven times the size of the Association of the
Southeastern Asia Nations along its infrastructure for high-tech manufacturing is very good.

 Lastly, Korea has a plenty of highly educated human resources.

Inspite of being the internationally and globally advanced free economic zone in Incheon, South
Korea have issues facing and they are the weakness of this Free economic Zone of Incheon and they
are mentioned below:

 Dispute over a new governing body for IFEZ.

 There’s a strong opposition from labor unions and civic organizations to the development of IFEZ.
It is criticized that IFEZ brings serious inequality among laborer in Korea.

 As IFEZ is business attraction focused on international business and the success largely depends
on national competitiveness.

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6.Conclusion:

As IFEZ is a perfect destination for foreign investment with perfect location for living comfortably and

experiencing pleasant modern Korean lifestyle for foreign investors. Moreover, IFEZ basically is created

to attract FDI which would play important role in the thriving Korean economy. As we know IFEZ

project compromises 3 separate districts within Incheon Metropolitan City covering 51,862 acres. IFEZ

has an ideal location for Free Economic Zone, well equipped high-tech infrastructure and big market with

highly educated human resources. Likewise, G-Tower one of the landmark buildings in Songdo which

also provides different services and information to the foreigners and people living around the IFEZ

location is remarkable. However, there are some drawbacks, threats and risk of the IFEZ that also draw

attention for criticism and opposition from labor union of Korea. Moreover, there’s a risk from North

Korea and its nuclear experiment. Despite of the fact, IFEZ is creating its own exemplary global hallmark

reign that has made remarkable reforms on economic growth of South Korea which is attracting not only

local markets but also global communities, organization, international trade and entrepreneurship.

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