Controversy over Government’s “FEZ Special Local Government” Plan

The central government will launch efforts to join the “Free Economic Zone Authority (FEZA),” which governs three free economic zones – Incheon, Busan-Jinhae, and Gwangyang.

However, controversy is expected as local governments fiercely oppose the decision, deriding it as “an attempt to expand central government capacity.”

On Wednesday, the Ministry of Finance and Economy (MOFE) gave the final report presentation at the Gwacheon Government Complex on “studies on establishing a special local government for free economic zones,” commissioned to the Korea Association for Public Administration (KAPA).

MOFE plans to consult with the local governments and related departments based on this report and revise the free economic zone law and the local autonomy law.

The report proposed establishing a special local government in which the central government joins the local government in governing the FEZs.

Under the proposal, vice-ministerial officials from the central government, deputy heads of local governments, and local council members would form a non-standing board, which would be the highest decision making group of the FEZA.

In addition, the report suggested that the board elect the agency director, who has so far been elected by the local governments, and that the central and local governments be able to dispatch officials to the FEZA.

The Incheon FEZA is currently run in the form of a branch office of the city government. Busan City and Gyeongnam Province jointly operates the Busan-Jinhae FEZ, and Jeonnam Province and Gyeongnam Province operate the Gwangyang FEZ.

An MOFE official explained, “The report suggests a way to address the often-cited hurdles in the current system in which local councils intervene excessively into the FEZA and which need to be further specialized.”

However, Incheon City and other local governments raised opposition, calling the report an “ill-intended attempt at expanding central government control.”

The Citizen Council against Establishment of Special Local Government for the Incheon FEZA,” an organization of civic groups in Incheon, started a petition campaign against the central government’s move.

Joong-Hyun Park Hee-Jae Park sanjuck@donga.com min07@donga.com