Yeongju City Attracts 220 Billion KRW Defense Investment... Launching as a K-Defense City

On December 15, Yeongju City in North Gyeongsang Province signed a memorandum of understanding for investment with Gyeongbuk Province and Korea Defense Industry at the city hall auditorium to establish a defense industry manufacturing plant worth 220 billion KRW.

KDI, Gyeongbuk Province, and Yeongju City are signing a memorandum of understanding for investment and taking a commemorative photo. Photo by Yeongju City

This agreement marks the largest investment attraction in Yeongju's history and is a major project to build manufacturing facilities on a site of approximately 1.22 million square meters (about 370,000 pyeong).

The city expects this to serve as a turning point for Yeongju to emerge as a hub for the defense industry, which is a national strategic sector.

Korea Defense Industry, established in 2020, is a defense company headquartered in Sejong, currently operating factories in Daejeon, Boeun, and Gumi. As of 2024, the company recorded sales of 291.7 billion KRW, a 44.4% increase from the previous year, establishing itself as an emerging powerhouse in the domestic defense industry.

With this investment, a state-of-the-art defense industry manufacturing plant will be established in the Munsu-myeon area of Yeongju by 2031. This is expected to create 400 direct jobs, increase the resident population by 650, employ over 2,000 construction workers, boost local tax revenue by 26.3 billion KRW, and generate an economic ripple effect of 415.5 billion KRW.

During the project's implementation, safety reviews and diagnostics will be conducted under the supervision of relevant agencies such as the Agency for Defense Development and the Korea Weapon System Safety Association. The plan is to minimize residents' concerns through compliance with related regulations and systematic monitoring.

To attract this investment, Yeongju City has worked on improving site conditions by conducting land feasibility studies and adjusting ecological and natural grade ratings. The city has also focused on creating a business-friendly environment by establishing customized ordinances for companies, analyzing the economic impact on the region, and strengthening communication with citizens.

This agreement is regarded as the first step for Yeongju to become a "K-Defense City" through the attraction of high-tech industries and industrial advancement. The city plans to expand the industrial ecosystem by linking its growing cluster of drone companies-based on its selection for the national drone demonstration city project and designation as a special drone deregulation zone-with the defense industry.

Yoo Jeonggeun, Acting Mayor of Yeongju, stated, "This is an achievement that roots the defense industry, a core national sector, in the region," adding, "We will spare no administrative and financial support to help companies settle and grow stably."

Jung Jungmo, CEO of Korea Defense Industry, said, "Yeongju offers the optimal environment for the defense manufacturing industry, with its transportation, location, and proactive administrative support. We will build a safe and innovative factory that grows together with the local community."

Lee Cheolwoo, Governor of North Gyeongsang Province, commented, "We will continue to provide full support so that Yeongju can grow into a leading K-Defense Industry city representing Korea."

In September, Yeongju City signed a memorandum of understanding for a 1.2 trillion KRW carbon-free power generation project with Korea East-West Power. The city is focusing its administrative efforts on attracting high value-added industries centered on the K-defense and drone sectors. This investment is expected to serve as an opportunity to revitalize the regional economy through industrial diversification and to address the risk of local extinction.