South Gyeongsang Province (Gyeongnam) is moving forward with plans to expand its free economic zones by region to achieve balanced regional development and secure new growth engines. The eastern zone will be developed as a global logistics and tourism hub, while the western zone will be fostered as a center for the aerospace industry.
According to the provincial government on Tuesday, the eastern zone will build a "global logistics and tourism hub" in line with the activation level of the Busan-Jinhae Free Economic Zone. The plan links the Gimhae International Business City, the Changwon Jinhae New Port hinterland complex, and the Geoje Gadeokdo New Airport support city. The province maintains that Gimhae, Changwon, and Geoje — geographically adjacent to the Busan-Jinhae Free Economic Zone — should be included in the free economic zone.
In particular, the national business city planned for the Hwamok-dong area of Gimhae aims to become the largest international business hub in Northeast Asia. A related special law enacted in March established the institutional foundation for organic connections among port, airport, and rail (Tri-Port) infrastructure. The province will also build a multimodal logistics hub in preparation for the Northern Sea Route era and a self-sufficient live-work city model to advance the digitalization of high-value-added logistics industries.
In the western zone, the province plans to separate the Gwangyang-Hadong Free Economic Zone and establish a new "Western Free Economic Zone Authority" dedicated to fostering the aerospace industry. A 4.11-square-kilometer area in the Jinju and Sacheon region will be designated as the Phase 1 target site, with the free economic zone application to be pursued first. The total project cost is approximately 1 trillion won ($730 million). The province has built consensus on the new designation through consultations with the Ministry of Trade, Industry and Energy (MOTIE), Jinju, and Sacheon, and plans to amend the Free Economic Zone Act to establish a legal basis for separating and creating new zones from existing ones.
In Phase 1, an aerospace theme park including a convention center and a startup innovation campus offering education, entrepreneurship, housing, and employment functions will be developed within the Jinju and Sacheon free economic zones. The zone will then be gradually expanded to include Namhae, Hadong, Goseong, and Tongyeong.
The province will commission the Gyeongnam Research Institute to prepare a feasibility study for expanding and newly designating free economic zones, then file an application with MOTIE around September this year.
"Logistics and tourism in the eastern zone and the aerospace industry in the western zone are the two core engines that will drive Gyeongnam's future growth," said Kim In-su, director general of economy and trade at the Gyeongnam provincial government. "If the planned expansion and new designation of free economic zones are realized, Gyeongnam will have the second-largest free economic zone in the nation after Incheon, home to the Incheon Free Economic Zone."