Long-term Delay of Changwon Cultural Complex Town Due to 'Termination of Implementation Agreement'

Changwon City, Interim Report on Audit Results of Major Long-Term Pending Projects

Shim Byung-chul, Auditor of Changwon Special City, Gyeongnam, is giving an interim report on the audit results of the Changwon Cultural Complex Town Development Project. / Photo by Ryeong Lee ryeong@

[Asia Economy Yeongnam Reporting Headquarters reporters Song Jong-gu and Lee Se-ryeong] Changwon Special City in Gyeongnam cited the termination of the implementation agreement as the main cause of the long-term delay in the Changwon Cultural Complex Town development project.

On the 7th, Changwon City held a press conference and announced the interim results of the audit investigating the cause of the delay in the Changwon Cultural Complex Town development project.

Auditor Shin Byung-chul stated that inappropriate actions by the responsible departments were confirmed during the design and construction phases, management and operation phases, and dispute resolution phases according to the implementation agreement with the project operator and others.

Auditor Shin said, “The project unnecessarily drifted for a long time due to the notification of termination of the implementation agreement to the project operator in March.”

According to the city, the termination notice was given at the time due to reasons such as insufficient operational facilities.

On October 27th, the court ruled in a provisional injunction application filed by the operator against the city to suspend the effect of the termination of the implementation agreement, judging that the operator was not at fault.

Auditor Shin also pointed out deficiencies in the management and operation agreement, such as the exclusion of parties to the agreement.

“Although the management and operation agreement with Changwon Cultural Complex Town was signed on April 27, 2021, a significant portion of the roles and responsibilities between the parties, such as the detailed investment costs, the party responsible for bearing those costs, and the deadline for completion of detailed facilities, were omitted,” he explained.

He pointed out problems such as the failure to activate the dispute resolution mechanism stipulated in the agreement between the parties and abuse of authority, including violations of the public officials’ code of conduct by fixed-term public officials.

He added that the public official exerted undue influence on the project operator, resulting in a service contract worth approximately 1 billion KRW being signed with a company operated by his own younger brother.

The audit office has requested the responsible department to prepare a plan to normalize the project, and internal measures will be taken against the related personnel found to have issues, while matters requiring further investigation will be referred for prosecution.

The First Deputy Mayor of Changwon Special City, Gyeongnam, is expressing his determination to normalize the Changwon Cultural Complex Town development project. / Photo by Ryeong Lee ryeong@

First Deputy Mayor Ahn Kyung-won said, “We apologize for causing concern to citizens due to the project’s lack of smooth progress,” and added, “We will end the dispute through court mediation to promptly return the Changwon Cultural Complex Town to a public space.”

“On November 24th, both the city and the project operator expressed their intention to mediate to the court, and we will sincerely participate in the mediation process to find a reasonable solution as quickly as possible,” he also said.

Deputy Mayor Ahn said, “The mediation process is expected to be completed by the first half of next year,” and added, “Once the court mediation is completed, we will newly establish an operation plan for the public cultural space, complete all preparations by the second half of next year, and do our best to ensure the facility operates normally from 2024.”

Changwon City plans to conduct audits on other major long-term stalled projects following the Changwon Cultural Complex Town and proceed with project promotion based on the results.

This content was produced with the assistance of AI translation services.