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North Gyeongsang Province: Changing Manufacturing Paradigm to Meet Challenges of 4th Industrial Revolution
Interview with Gov. Lee Cheol-woo
North Gyeongsang Province: Changing Manufacturing Paradigm to Meet Challenges of 4th Industrial Revolution
  • By Lee Song-hoon
  • March 8, 2019, 17:01
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North Gyeongsang Province Gov. Lee Cheol-woo

North Gyeongsang Province is one of the most dynamic regions in South Korea. The province’s gross regional domestic product (GRDP) recorded 103 trillion won (US$91.2 billion) in 2017, the fifth largest among local governments in Korea. The province has a strong industrial base, especially in the IT, electronics, auto parts, metal and biotech industries, and ranks high among local governments in terms of future industry growth potential. Gov. Lee Cheol-woo, who was a member of the National Assembly before being elected as governor in June last year, has been busy attracting domestic and foreign investment to upgrade the province’s industries and meet the challenges of the Fourth Industrial Revolution. In a recent interview with BusinessKorea, Lee outlined how he would revitalize the province’s economy, create jobs, foster high-tech industries, and promote tourism and agriculture. The following are excerpts from the interview. – Ed.

North Gyeongsang Province is making a lot of efforts to attract overseas investment, including your visit to CES 2019 earlier this year. What is the province’s comparative advantage as an investment destination?

The province is trying to attract companies for job creation. A special committee was organized for more systematic investment attraction immediately after I took office. In addition, we are looking into U.S. local governments’ policies for investment attraction and job creation.

Any company wishing to invest in the province can benefit from a roadmap for systematic support, land-related support, employment-related subsidies and residential assistance for employees. We are building an all-in-one support model for investors.

What is the province’s recent investment attraction result and what are the fields it is concentrating on this year?

As I mentioned, investment attraction leads to job creation, which, in turn, leads to more young people in the region and solutions to the problem of low birth rate. This is why the province is focusing on corporate investment attraction.

North Gyeongsang Province signed 744 MOUs, worth 6,253.9 billion won (US$5.51 billion) in 2018 alone. Many of the MOUs were signed with companies in the fields of Industry 4.0, such as LG Innotek, SK Bioscience and Ecopro. These days, an increasing number of companies are expressing their interest in the province and its tailored incentives provided via the special committee.

North Gyeongsang Province has a strong industrial base, yet it needs to grow new industries in the era of the Fourth Industrial Revolution. What is your strategy to that end?

The province is trying to change the paradigm of manufacturing to better respond to the new industrial revolution. The Smart Factory 1,000 project has been launched in this regard so that manufacturing processes can be innovated and refined based on artificial intelligence, enhancing manufacturing productivity and reducing the ratio of faulty products. Also, we are investing in R&D on artificial intelligence and setting up a blockchain center in cooperation with POSTECH for blockchain ecosystem creation in the region.

Agriculture and fisheries should be better fostered in the same context, too. We attracted a smart farm innovation valley in Sangju in August last year and it will become a linchpin of smart farm technology development for an increase in farming household income, assisting with new young farmers’ settlement. When it comes to fisheries, we are currently testing smart fish farms characterized by ICT-based environment monitoring and animal disease control. North Gyeongsang Province is responding to the Fourth Industrial Revolution by stimulating innovation in the manufacturing and agro-fishery sectors.

The province, which is home to a lot of tourist attractions, is planning to set up a new public corporation for cultural tourism promotion. What will be the role of the corporation?

The existing Gyeongsangbuk-do Tourism Corporation will be turned into a new corporation so that the province’s competitiveness in cultural tourism can be bettered utilized for regional economic stimulation. The new agency will be engaged in expanded marketing and sales activities both at home and abroad while working on tourism programs and products reflecting the latest trends.

Specifically, the spectrum of cultural tourism will be widened so that the province’s various ecological resources can be better utilized in the form of farming experience, forest experience, leisure sports, and so on.

Agriculture represents a large portion of the province’s overall industrial activities. What policy does it have for agricultural development?

North Gyeongsang Province is second to none in South Korea in terms of the numbers of farming households and farming population. In addition, it has ranked first for 14 years in a row in the number of those returning from cities to become farmers. Agriculture is the very foundation of our provincial administration and what the province can do best.

We are seeking new opportunities in the industry from the younger generation, logistics innovation, high technology, and integration between the primary, secondary and tertiary industries. In this vein, the Gyeongbuk Farmers Academy will be expanded into an agency in charge of agrifood logistics training, which will work on logistics and marketing plans, simplify product distribution channels and contribute to logistics cost reduction for a higher level of logistics efficiency.

At the same time, various measures will be implemented for sustainable agricultural growth in the region. The examples include profit sharing based on senior farmers’ land leased to younger farmers with less foundation.

You have stressed the importance of decentralization of power as a way of revitalizing non-capital regions. How should it be carried out?

When I was a lawmaker, I served as a co-chair of the National Assembly forum for the purpose. All the way since then, I have been convinced that a country can prosper when its regions thrive. Decentralization of power is the key to the prosperity of South Korea as seen in the case of France, Switzerland, and so on.

It cannot be denied that the federal system-level decentralization promised by President Moon Jae-in is unlikely to take root in the near future. Still, at the 6th Korea Local Autonomy Expo held in Gyeongju in October last year, the president promised to proceed with the balanced national growth and decentralization that require no constitutional amendment and listen more to the voices of local governments during the course on the basis of regular meetings between the central and local governments. What matters is direction rather than speed. I believe decentralization will be around us soon if preparations are made well for reflection of opinions of regional residents.

What would you like to say to the people in the province?

The provincial government’s administrative keywords for this year are pragmatism, communication and future. We will slim down by stopping unnecessary projects and will become more communication-oriented so that our policies can make an even more practical contribution to their everyday living.

Also, new and creative projects will open the future of the province. The examples will include Good Neighbor Communities and Urban Youth in Countryside as well as the land lease for younger farmers. The province will become a whole new community this year based on such efforts for change and innovation.

Our goal can be achieved only when the people in the province join together. On behalf of all civil servants in the region, I ask them to join together in creating new North Gyeongsang Province.