Population, Income, and Investment Concentration in the Seoul Metropolitan Area Intensifies... "New Government Must Take Bold Steps for Regional Balanced Development"

BNK Economic Research Institute Report Released

343 Eup, Myeon, and Dong in the Southeast Region Facing Disappearance

Changwon National Industrial Complex.

[Asia Economy Yeongnam Reporting Headquarters Reporter Ju Cheol-in] An analysis has emerged that bold regional balanced development policies are needed as the population decline in the Southeast region is increasingly expanding, and the birth rate slowdown and aging speed are also accelerating with the launch of the new government.

BNK Economic Research Institute announced a research report titled "Development Tasks to Revitalize the Southeast Region Economy" on the 8th. According to the report, the population of the Southeast region has been declining since 2016, and the rate of decline is further expanding.

As the population rapidly decreases, as of February, 343 out of 566 eup, myeon, and dong in the Southeast region, accounting for 60.6%, were identified as being at risk of extinction.

In the Southeast region, the total fertility rate in 2020 dropped to 0.75 in Busan, 0.98 in Ulsan, and 0.95 in Gyeongnam, and it is expected to enter a super-aged society by 2024.

Population data nationwide and in the southeastern region. / Provided by BNK Economic Research Institute

The Southeast region is also struggling to find momentum for economic vitality rebound. In the Regional Growth Potential Survey by the Korea Institute for Industrial Economics and Trade, the Southeast region recorded the lowest growth potential among domestic economic zones as of 2020.

While the increase in the number of employed persons lagged behind the national average, the growth rate of quality jobs that can prevent the outflow of talent in knowledge service industries and high-income jobs and attract talent has slowed.

From 2013 to 2020, the employment growth rate in the knowledge service sector in the Southeast region was 0.8%, significantly lower compared to 16.8% in the Seoul metropolitan area. The number of employed persons in high-income jobs in the Southeast region decreased by 3.3% during the same period, whereas it increased by 8.2% in the Seoul metropolitan area.

The level and conditions of private sector investment also weakened. The Southeast region's share of total gross fixed capital formation nationwide fell from 16.7% in 2013 to 13.9% in 2020, while the Seoul metropolitan area’s share rose from 41.8% to 47.6% during the same period, further intensifying the concentration of investment in the Seoul metropolitan area.

The research institute pointed out that the sluggish investment in the Southeast region stems from a lack of large corporations and innovative companies. Among the top 1,000 domestic companies, those headquartered in the Seoul metropolitan area increased from 701 in 2008 to 743 in 2020, but in the Southeast region, the number decreased from 134 to 89 during the same period.

A representative from the research institute said, "Despite various regional development policies pursued by successive governments, the concentration phenomenon in the Seoul metropolitan area in terms of population, income, and investment has not improved," adding, "The recent establishment of the Regional Balanced Development Special Committee by the Presidential Transition Committee strongly expresses the will to promote regional development, and the new government should implement more bold regional balanced development policies."

Jung Young-du, president of BNK Economic Research Institute, emphasized, "At the early stage of the new government’s launch, it is necessary to boldly promote symbolic regional balanced development policies," and added, "For policies agreed upon and empathized by both ruling and opposition parties, it is important to accelerate execution speed to achieve visible results early."

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