[Opinion] ‘Corporate Cities’ Without Companies

Most of Paju, Gyeonggi Province, had long been protected from industrial development since the southern Seoul suburb was designated a military protection area. Paju, however, has turned itself into an industrial hub after attracting LG Philip’s liquid crystal display factory in early 2003. The village of Tangjeong in Asan, South Chungcheong Province, had been full of vineyards until Samsung built an LCD plant there. The town of Dangjin in South Chungcheong Province looks similar to other neighboring villages, but after 10 minutes of driving, one can see high-rise apartments and modern buildings along a four-lane road. The landscape of the area has also changed since Hyundai Steel acquired the bankrupt Hanbo Steel in 2004. Examples show how corporations have changed not only city landscapes but also people’s lives.

The Finnish city of Oulu is 500 kilometers away from the capital of Helsinki and is home to 130,000 people. The city, however, is the world’s largest corporate city. Since the world’s largest handset maker Nokia established its own research center in Oulu, suppliers as well as global firms such as Sony and Canon have gone to the city in droves. Around 70,000, or more than half of the city’s population, work for firms large or small. Employees of affiliates of the Oulu city government say without hesitation, “It’s our responsibility to provide what companies want.”

Silicon Valley in California and Toyota in Japan are prime examples of corporate cities, in addition to Sweden’s Kista Science City. Lee Gyu-hwang, executive director of the Federation of Korean Industries, urged Seoul to introduce corporate cities in Korea in 2004. He said Korea should set up such cities and nurture industrial clusters into new growth engines given that international competition has rapidly pitted regions and cities versus each other. The previous administration put priority on balanced national development, but accepted the suggestion and set up relevant laws in 2005.

Among six candidate cities designated by the government, only Taean County lured a firm last year. Chungju and Wonju have gotten only approval. The biggest challenge is that the government chose corporate cities from its own perspective, not from that of companies. Corporate cities have complained of difficulty in drawing investment. On the other hand, Paju has become a corporate city without the appropriate designation.

Paju Mayor Yu Hwa-seon said, “Other corporate cities have been unsuccessful since they are not serious enough to make an all-out effort to attract companies.”

The Federation of Korean Industries hit back by saying, “Corporate cities are not attractive investment destinations due to heavy regulations and lack of infrastructure.”

Editorial Writer Hong Kwon-hee (konihong@donga.com)