An exclusive industrial complex for Korean companies will be set up in Dandong, China, just across the Yalu River from North Korea newly designated Shinuiju Special Administrative Region.
The Ministry of Commerce, Industry and Energy (MOCIE) said yesterday that the Korea Industrial Complex Corp. (KICOX) president Lee Hyo-jin will sign a contract with Dandong City Communist Committee Director General Cai Zhefu to establish a Korea-China Model Industrial Complex in Dandong, Liaoning Province, China, in Seoul today.
The industrial complex will be established on 86,000 pyong of land inside the Donggang Economic Development Zone governed by the Dandong City government. One pyong is equal to 3.3 square meters.
Donggang is a strategic point for South Korean firms conducting business in both North Korea and China.
Its geographical location with the Yellow Sea to the south and the Yalu River and the Shinuiju special zone to the east, would make the city a strategic logistics and industrial point in North East Asia once Korea Seoul-Kyongwon Railway is reconnected and linked with the Trans-China Railway (TCR). It is also 420 km away from Seoul.
The first phase of the construction project will kick off at the end of this month and will be completed by August 2003, said MOCIE.
The Korean government plans to expand the Korea-China Model Industrial Complex to 300,000 pyong in the future.
It said the industrial complex will initially house a total of 40 Korean companies in labor intensive industries like apparel, electronics, textiles and shoes manufacturing, as well as those from wood processing, fisheries and food and beverage sectors.
MOCIE said its survey last June showed that a total of 48 South Korean companies intend to use a combined 100,000 pyong of land in the complex.
A business support center will be established within the Korean exclusive industrial complex in Dandong to help Korean companies solve bottlenecks in running business and to provide business information and employee training and education.
The land for the Korea-China Model Industrial Complex will be leased for 50 years until 2053, and the land lease price for Korean companies moving into the industrial complex is expected to be set at 60,000-70,000 won per pyong, MOCIE said. This is cheaper than the lease price in other Chinese industrial complexes, it added.
Dandong City trade with North Korea amounted to $200 million last year, and 138 Korean companies had invested a total of $82 million in the Chinese city by the end of April.
However, Korean companies are not expected to begin investing in the industrial complex too hastily as Chinese police took Yang Bin, the man charged with heading North Korea's Shinuiju Special Administrative Region, into custody early yesterday morning on what appears to be an investigation into suspected tax-evasion.
Yang, one of the richest tycoons in China, was expected to return to the North Korean city this week to proceed with the development of the Shinuiju Special Administrative Region.
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