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A Study on the Current Status of Global Investment Promotion Agencies and Implementation Plans in Seoul

Author: 
Mook Han KimㆍChan Young HongㆍMinsup HwangㆍIn Hye Yu

The Seoul Metropolitan Government announced the establishment of the ‘Seoul Investment Agency’ as an institution responsible for attracting investment from Seoul in the ‘Seoul Vision 2030’ in 2021. Accordingly, the 'Invest Seoul Center' is currently operating within the Seoul Business Agency to promote foreign investment attraction. Internationally, the Seoul Investment Agency represents for ‘Investment Promotion Agency (IPA)’, which means ‘a national or local government institution that has the authority to attract and increase investment in the field of foreign direct investment’. Global investment promotion agencies have been spreading in a number of countries based on their achievements in regional development since the 2000s, and recently, the number of establishment of investment promotion agencies in the country as well as cities and regions has been increasing.

As key examples of city-level investment promotion agencies, the Invest Hong Kong in Hong Kong, Economic Development Administration in Singapore, London & Partners in London, and Berlin Partners in Berlin were selected and analyzed. Although there were some differences in the size of these investment promotion agencies, they are performing the investment promotion functions such as image building, investment generation, investment facilitation and retention, and policy advocacy. The difference is that Hong Kong and Singapore focus on attracting public-centered investment through land sales, whereas London and Berlin are characterized by private-focused investment that matches industries and companies, and the public and private sectors are cooperating through non-profit organizations.

Seoul's foreign direct investment surpassed $10 billion last year and it was at an all-time high. In such a change in Seoul’s foreign direct investment, corporate matching is becoming more vital, but there is a shortage of available land in Seoul, so Seoul must benchmark London and Berlin, which are similar cases. Seoul's investment promotion agency should differentiate itself from the national institutions as a strong player specializing in Seoul's promising sectors and policies at an early stage. To this end, it is necessary to strengthen the administrative support channels within the city's authority, such as follow-up management, and to focus on strengthening image building and policy advocacy functions.