Jeju Special Self-Governing Province is inducing a major transformation in the Jeju economy through an investment of KRW 1.2 trillion.

Jeju Province plans to focus its investment on four main areas: KRW 284.8 billion for grassroots economic stability, including price stabilization; KRW 73.7 billion for nurturing leading innovative companies and fostering listed companies; KRW 337.2 billion for expanding the external reach of Jeju’s economy including territory expansion for exports, and KRW 563.4 billion for bolstering the economic foundation for new growth industries and high-value-added industries.

Last month, the Jeju Provincial Government held a meeting at the Jeju Provincial Office to share the direction of economic policies for the upcoming year and discuss collaborative strategies for economic leap. In this meeting, the Bank of Korea’s Jeju Branch presented the domestic and international economic conditions and recent economic trends in the Jeju region, followed by discussions on the direction of economic policy for 2024 and strategies to revitalize the regional economy.

It is anticipated that the global economy will continue a modest growth trend in 2024. The future of Jeju’s economy is expected to gradually recover from the recent economic downturn, thanks to the normalization of domestic overseas travel demand and the improvement in the recovery of foreign tourists. Accordingly, proactive alternatives to invigorate the economy were discussed at this meeting.

The meeting was attended by about 30 people, including experts from various sectors such as economic associations, small businesses and corporations, tourism, primary industries, construction, consumers, local communities, academia, research, and administration, as well as related organizations and groups.

Governor Oh Young-hun remarked, “We are witnessing a rebound trend with rising export effects in primary industries, semiconductors, and gaming, and are deeply contemplating and preparing our response in line with the growing expectations for tourism revitalization, such as through cruises. However, due to a reduction in local allocation tax caused by national tax deficits, we projected a 2% growth for the 2024 budget. But considering the actual inflation rate and wage increases, it is nearly akin to a negative budget situation.” He continued, “We will analyze the government budget proposal and check additional fiscal conditions to concretize a new economic policy direction.”

Focused on the People’s Livelihood Economy

Aiming to invigorate the grassroots economy, initiatives include investing KRW 48 billion in stabilizing prices and invigorating private consumption, KRW 120.2 billion in creating jobs and strengthening labor rights, and KRW 116.6 billion in protecting vulnerable groups through financial inclusion policies.

Continual efforts are made to boost the sales of small businesses through the stable operation of the local currency, the Tamnaneun (meaning ‘Desirable’) Voucher, alongside various promotional and marketing efforts to expand the consumption of Jeju-made products and stimulate domestic demand. Initiatives to enhance the vitality of traditional markets and shopping districts include upgrading old facilities and creating smart traditional markets. Also, the promotion of primary industry product consumption through online and offline discount events aims to foster mutual growth between farmers, fishermen, and consumers.

With the highest employment rate in the country at 70.8%, tailored support for young and middle-aged workers who still face difficulties entering society is a continuous priority, including employment, saving lump sums, and housing. This includes expanding and reorganizing labor rights centers to ensure more workers benefit from these policies.

It is a priority to support the payment of guarantee fees for second-tier financial institution loans for young workers with difficulty forming assets and low credit. Efforts are also focused on creating a comprehensive welfare environment through the Jeju-style integrated care policy and public rental housing to stabilize housing.

Investing in the economy’s future, KRW 24.6 billion is allocated for cultivating and attracting listed companies, KRW 21.2 billion for fostering promising new growth manufacturing industries, and KRW 27.9 billion for supporting the innovative growth of small businesses.

Efforts to nurture companies aspiring to go public include expanded support for tailor-made in-depth programs and investments in listed company development funds. Intensive management of ten investment-interest companies and the aim to achieve a workcation population of 20,000 are part of the strategy, alongside utilizing existing accommodation and public facilities to stimulate local consumption.
The strengthening of promising new growth manufacturing industries continues with the intensive nurturing of excellent companies with the potential for innovative growth. The goal is to lead these industries into achieving a 10% share in the manufacturing sector and enhance product competitiveness through premiumization and design enhancements.

To support the innovative growth of small businesses, removing industry restrictions from the Small and Medium Enterprise Development Fund and increasing the support limit to up to KRW 500 million are key strategies. Dedicated support, such as consulting throughout the business cycle from start-up to closure, aims to bolster the competitiveness of small business owners. Additionally, for individual businesses in local commercial districts, non-collateral loans of up to KRW 50 million per business are provided to help alleviate immediate financial difficulties.

Growth of the Culture and Tourism Industry

Efforts to expand the reach in various sectors are evident with an investment of KRW 110.1 billion for the qualitative growth of the culture and tourism industry, KRW 214.6 billion to invigorate the construction sector, and KRW 12.5 billion for expanding export territories and innovating the logistics system.

The cultural industry is being fostered as a future core industry through the development of Jeju-specialized content and support for exports, as well as the establishment of an Artists Welfare Fund to support the creative activities of artists and cultural professionals. With the upcoming ‘Visit Korea Year,’ efforts are underway to gear up for a new era of 15 million tourists through individualized marketing tailored to both domestic and international travelers.

Securing the hosting of the 2025 APEC summit, estimated to bring a direct effect of KRW 1.783 trillion, is a top priority. A differentiated application that leverages Jeju’s unique strengths is being crafted as part of the bidding process.

Stimulating the construction industry involves securing stable public procurement volumes through new streetlight installations and road structure improvements, supporting entry into overseas construction markets, and implementing accessibility improvement projects for a “15-minute city.”

Enhancing the momentum towards achieving a $300 million export goal involves resolving obstacles at every stage of export quickly. The creation of smart joint logistics centers and the expansion of joint logistics support aim to reduce the burden on residents and realize logistics innovation. The smart joint logistics center based in Jeju and the Nokdong New Port logistics center on the mainland will be key in establishing an interconnected logistics system between Jeju and the mainland.

Concentrated efforts are being made to expand the new growth economic foundation, including investing KRW 167.7 billion in fostering high-value-added new growth industries, pioneering the future of the primary industry with KRW 343 billion, and cultivating creative and innovative talent to lead Jeju with KRW 52.7 billion.

Expanding and constructing a green hydrogen ecosystem and developing systematic strategies to nurture the hydrogen economy are ongoing. Moving forward with the construction of the Hanwha System Space Center in Hawon Techno Campus is part of the initiative to become a leading city in the space industry. Diligent progress is being made in the foundational analysis necessary for constructing infrastructure like vertiports, essential for the commercialization of Urban Air Mobility (UAM) as a new form of tourism transportation in Jeju’s urban areas.

Stabilizing agricultural product supply and securing income stability for farmers are priorities through the operation of the Jeju Agricultural Product Supply Management Center and the Agricultural Observation Data Center. With the establishment of the Jeju Marine Healing Center and Marine Leisure Tourism Hub Center, the intention is to develop clean marine resources for healing purposes and cultivate the cruise and leisure industries into future marine industries.

Local governments, universities, and regional innovation organizations are collaborating to accelerate the Regional Innovation Strategy (RIS), which includes nurturing talent, advancing technology, supporting enterprises, and creating a startup ecosystem necessary for fostering the three core sectors: clean bio, green energy & future mobility, and intelligent services.

Meanwhile, the Bank of Korea forecasts that the global economy will continue a modest growth trend into the next year due to the ongoing impact of high-interest rates, projecting a 2.8% economic growth rate. Furthermore, it predicts that the domestic economic growth rate will continue an improvement trend this year due to the recovery of exports and capital investment, indicating a level of 2.1%.