Assemblyman Shin Jeong-hoon: "It's Time to Start Season 2 of Energy Valley with Strategic Development Policies"

Intensified Bidding Competition Among Resident Companies, Urgent Need for Local Priority Purchase Guidelines

[Asia Economy Honam Reporting Headquarters Reporter Park Seon-gang] It has been revealed that companies residing in the Energy Valley, which is being developed around the Gwangju-Jeonnam Joint Innovation City, are experiencing excessive competition due to overlapping investments in the same product categories, and their competitiveness is deteriorating due to indiscriminate expansion of production items after moving in.

Shin Jeong-hoon, a member of the National Assembly's Industry and Energy Committee from the Democratic Party of Korea (Naju-Hwasun), pointed out that among the 23 product categories produced by Energy Valley resident companies, there is excessive competition concentrated in specific items such as transformers (58 companies), cable protection plates (51 companies), electricity meters (41 companies), waveform pipes (41 companies), circular waveform pipes (41 companies), and circuit breakers (35 companies).

Currently, there are 569 companies residing in Energy Valley. However, only 147 companies, accounting for 25.8%, have direct production approval.

This is understood to be because companies entering Energy Valley establish and operate factories expecting regional allocation volumes that prioritize local purchases up to 20% of KEPCO's annual purchase volume, according to the designation as a 'Special Support Area for Local Small and Medium Enterprises,' but in reality, many of the resident companies have multiple branches and subsidiaries.

In this regard, the Naju Innovation Industrial Complex Resident Companies Association stated, “Research institutes and skilled personnel are all located in the metropolitan cities where the headquarters are based. Contrary to the purpose of supporting the 'Special Support Area for Local Small and Medium Enterprises,' the situation has deteriorated in a completely different direction, weakening Energy Valley's competitiveness, causing ongoing management difficulties, and quantitatively not contributing to job creation,” appealing for countermeasures.

In response, Assemblyman Shin said at the KEPCO national audit on the 15th, “We need to induce sound investment and production by strengthening the direct production criteria,” and added, “Supplementary measures should be prepared to allocate volumes to companies that have actually invested in land, personnel, and production facilities.”

He also proposed, “KEPCO needs to establish production item guidelines for resident companies through a consultative body with local governments and industrial complex associations. When attracting new companies, production should be encouraged focusing on items with less competition.”

According to the current 'Act on Promotion of Purchase of Small and Medium Enterprise Products and Support for Market Development,' public institutions are obligated to verify whether the small and medium enterprise directly produces the product when concluding procurement contracts for competitive products among small and medium enterprises by competition methods or negotiated contracts exceeding 10 million won.

Assemblyman Shin Jeong-hoon emphasized, “At the early stage of Energy Valley development, only quantitative attraction goals were set without detailed classification such as scale and industry. There was no strategy to improve the investment execution rate of attracted companies,” and added, “With the target of attracting 500 companies this year being achieved, it is now time for Energy Valley to shift its policy from company attraction to strategic development and start Season 2.”

This content was produced with the assistance of AI translation services.