[The Editors' Verdict] Where Companies Arrive and Depart

Kyung-ho Lee, Head of Issue & Trend Team

Dangjin, Chungnam, is drawing attention due to a company called YK Steel relocating from Busan. Locals are hopeful for the regional economy, saying, "A leading domestic steel company is bringing 750 jobs to Seokmun National Industrial Complex. The salary levels are also quite substantial." Founded in 1958 as Geukdong Steel Industry, YK Steel moved its factory to a site in Saha-gu, Busan, in 1966 and has been a fixture in Busan for over 60 years. As of 2023, it is a solid company with sales of 610 billion KRW, operating profit of 35 billion KRW, and about 360 employees. The reason for the company leaving Busan was due to various complaints about dust and noise after apartments, commercial buildings, and schools were built around the factory. The phrase "An apartment that rolled in is driving out the factory it pierced" became popular. Some residents question, "Is it desirable for companies to leave and jobs to decrease in Busan, which is directly hit by population decline and aging?"

In Boryeong, Chungnam, controversy surrounds the relocation of the largest local automotive parts manufacturer. The company, with sales in the 100 billion KRW range, located in the Gwanchang Industrial Complex in Boryeong, gained attention for applying conveyor equipment to smart farms using a new construction method. However, complaints were filed about this company operating smart farm facilities in an automotive-related industrial complex, and Boryeong City ordered the facility's demolition. The company’s representative lamented to Daejeon MBC, "When the mayor visited, I asked verbally, and I asked several times when city officials came as well." Eventually, exhausted by prolonged litigation, the company signed a memorandum of understanding (MOU) with Daejeon City and decided to relocate by 2026.

Hanam City, Gyeonggi Province, was a place where nearly 80% of the total area was greenbelt, with numerous factories scattered around. With the development of a new town, the population grew from 120,000 in 2000 to over 300,000 now. However, the per capita Gross Regional Domestic Product (GRDP, based on 2020) was 26.71 million KRW, which did not reach the Gyeonggi Province average of 36.52 million KRW. It was at risk of becoming a serious bedroom community without self-sustaining functions. Hanam City merged the previously separate ordinances for corporate support and investment attraction into a single ordinance and passed the "Hanam City Corporate Investment Attraction and Support Ordinance" last year. They put all their efforts into attracting companies, from incentives to subsidies and housing supply.

As a first result, mid-sized construction company Seohui Construction moved its headquarters from Bundang-gu, Seongnam City, to Hanam City. Seohui Construction recorded sales of 1.4151 trillion KRW, operating profit of 226.3 billion KRW, and net profit of 157.7 billion KRW last year (separate basis). The company has 823 employees in total. Jung Hyunsik, founder of 'Mom's Touch' and chairman of the Korea Franchise Industry Association, purchased a headquarters office in Hanam, and BC Card decided to build a research and development (R&D) center there. The well-known golf equipment brand 'PXG' subsidiary Kan? will complete its R&D center by the end of the year. Lee Bonggwan, chairman of Seohui Construction, Choi Wonseok, CEO of BC Card, and Jang Jiyeon, vice chairman of Kan? Co., were invited to the inauguration 2nd anniversary talk concert hosted by Hanam Mayor Lee Hyunjae on the 4th.

There is a saying, "You don't notice the place where someone has come, but you know the place where someone has left." It means that while the presence of newcomers may not be obvious, the absence of those who leave is significant. The same applies to companies. Perhaps that "place" is directly connected to the city's survival beyond just job creation and tax revenue. Maintaining companies is as important as attracting them. If conflict prevention and resolution fail, companies will neither come rolling in on their own nor will established companies remain indefinitely.