Hong Nampyo, Changwon Special City Mayor, "I Will Transform Changwon into South Korea's Top Manufacturing City"

"We will reinforce the fertility of the existing Changwon National Industrial Complex and successfully establish a new Defense-Nuclear Convergence National Industrial Complex to transform Changwon into the best manufacturing city in South Korea."

Hong Nampyo, Changwon Special City Mayor.

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The Changwon National Industrial Complex in Gyeongnam celebrated its 50th anniversary on April 1st. To commemorate this, Changwon Special City has designated the period from the 23rd to the 27th as the 'Changwon National Industrial Complex 50th Anniversary Commemoration Week' and will hold various events. Hong Nam-pyo, the mayor leading Gyeongnam Changwon Special City in the 8th local government term, is putting special effort into preparing a new vision for the next 50 years of the industrial complex, which will be announced on the 24th, as much as celebrating the anniversary with citizens.

Established on April 1, 1974, the Changwon National Industrial Complex (hereafter Changwon Complex) has served as the cradle of South Korea's machinery industry for the past half-century, playing a key role in the nation's rapid economic growth and prosperity. However, due to aging facilities, worsening domestic and international economic conditions, and the nuclear phase-out policy, its reputation had gradually declined.

Fortunately, since Mayor Hong Nam-pyo took office in the 8th local government term, warmth has gradually returned centered on defense industry. In 2023, the production value surpassed 60 trillion won for the first time ever, and exports reached 18 billion USD, marking a turning point for the Changwon National Industrial Complex.

Mayor Hong said, "It is a great honor to serve as mayor at the time when the Changwon National Industrial Complex, created by the future strategist President Park Chung-hee, celebrates its 50th anniversary. The year 2024 will be a historic year marking the start of the 'Changwon National Industrial Complex Grand Renovation Project' to commemorate the past 50 years and simultaneously prepare for the next 50 years of the complex," expressing his thoughts on the 50th anniversary.

He continued, "The Changwon Complex is a historic site that achieved the success story of Korea's modernization and industrialization, which laid the foundation for South Korea's leap to a developed country. It has been a livelihood for many citizens by providing jobs and transformed the defense industry, which had to rely on foreign countries, into self-reliant national defense. Especially, it is the base of the nuclear power and defense industries that have driven South Korea into the world's top 10 economies," he emphasized.

He also described the current situation of the Changwon Complex: "Over the past 50 years, it has experienced many ups and downs. In particular, the previous government's nuclear phase-out policy dealt a fatal blow to the nuclear power industry, which is Changwon's main industry. Fortunately, since the launch of the Yoon Suk-yeol administration and the 8th local government term, thanks to efforts to restore the nuclear industry ecosystem and invigorate defense exports, the complex has regained its position as a machinery industry hub, achieving a production value of 60 trillion won for the first time last year," he evaluated.

Until the early 1970s, South Korea's economy was supported by light industry exports, but as other developing countries expanded their overseas market entry, the competitiveness of light industry reached its limits. In response, President Park Chung-hee declared 'heavy and chemical industrialization' in his New Year's address in January 1973 and announced a plan in June of the same year to foster six strategic industries including machinery, shipbuilding, and chemicals.

To realize this, the establishment of an industrial complex was necessary. After weighing several candidate cities nationwide, the Changwon area was selected as the machinery industrial complex due to its superior industrial location conditions: convenient transportation with surrounding cities in the southeast region, suitable ground for heavy factory construction, easy access to industrial and residential water, and smooth supply of residential land.

In September 1973, President Park issued the 'Directive on the Construction of Changwon Machinery Industrial Base,' and on April 1 the following year, the official development of the Changwon National Industrial Complex began under Construction Ministry Notification No. 92. Modeled after Canberra, Australia, the city structure was designed with a 'separation of residence and workplace,' placing the Changwon Machinery Industrial Base south of the 13.5 km-long Changwon Boulevard?the longest straight road in Korea?and residential areas to the north.

At that time, the scale consisted of 14 million pyeong of residential area and 3 million pyeong of factory land. After converting rice paddies, fields, land, and forests into factory land, facilities were constructed by dividing the area into industrial, residential, and public zones on the new site.

Panoramic view of Changwon National Industrial Complex.

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The Changwon Complex began operation in 1975 with Busan Pogum producing valves, and by the late 1970s, large companies such as Geumseongsa, Daewoo Heavy Industries, Kia Machinery, Korea Special Steel, Busan Steel, and Samsung Heavy Industries had settled in, establishing the Changwon National Industrial Complex as a hub of machinery industry.

The complex grew in tandem with the government's 1970s goals of fostering heavy and chemical industries and achieving 10 billion USD in exports. Production and exports of resident companies were only 1.5 billion won and 600,000 USD in 1975, but led by industrial machinery and transportation machinery, production exceeded 10 trillion won in 1994, reached 58 trillion won in 2015, and exports surpassed 1 billion USD in 1987, 10 billion USD in 2005, and 23.9 billion USD in 2012. The revitalization of the complex led the old Changwon City to reach its planned population of 300,000 in 1989, 400,000 in 1994, and over 500,000 in 2007.

However, recently the complex has faced issues such as aging facilities. The main industries have encountered significant crises. While the defense industry managed to maintain the status quo with difficulty, the previous government's nuclear phase-out policy dealt a severe blow to the nuclear power industry. The complex's performance also declined. Over the past decade, production dropped from 55 trillion won in 2011 to 45 trillion won in 2021, a decrease of 10 trillion won, and exports fell from 23.3 billion USD to 12.3 billion USD during the same period.

Mayor Hong said, "The Changwon National Industrial Complex has driven South Korea's economy for half a century, but currently, growth is stagnating due to aging facilities, workforce outflow, and lack of infrastructure, falling behind the times. It is time for changes and innovations suitable for the 4th Industrial Revolution era, such as digital transformation of resident companies."

He added, "Today, unlike the past, the era demands small-lot, multi-variety production according to consumer demand rather than supplier-oriented mass production of a few products. In other words, creators are needed more than simple makers. However, Changwon's current industrial structure is a traditional, heavy, vertically integrated one from the industrialization era. It must diversify by actively attracting light, compact, and small industries to adapt to changing times," he emphasized.

In February, President Yoon Suk-yeol promised at a public discussion in Changwon to transform the Changwon National Industrial Complex into a convergence space where culture and industry coexist, pledging strong support from the central government to open the new 50 and 100 years of the complex. He also announced plans to lift land use regulations and industry restrictions in the complex. Following up, last month, Minister Yoo In-chon of the Ministry of Culture, Sports and Tourism and Minister Ahn Duk-geun of the Ministry of Trade, Industry and Energy jointly visited Changwon to discuss creating an industrial complex with cultural elements with Mayor Hong.

Mayor Hong said, "Unlike before, the future complex should not be just a workplace but a convergence space where workers can enjoy leisure, culture, and industry together. We will carefully analyze government policy directions and prepare well on how to change the complex's land use and engine, and improve living conditions for workers," he said.

Earlier, the 8th local government of Changwon Special City began establishing a strategic vision that will serve as a turning point for the next 50 years on the 50th anniversary of the Changwon National Industrial Complex. In March last year, a 'Changwon National Industrial Complex 50th Anniversary Development Council' composed of 20 experts from industry, academia, and related organizations was launched to devise development plans for the complex.

After broad consultations including professional agency research, the finalization of the 'Future 50-Year Vision for the Complex' is underway. Drawing references from China's Shenzhen Special Economic Zone and France's Grenoble Giant Project, the future vision includes strategies and policy directions embodying four core values: innovation, eco-friendliness, learning, and vitality.

Mayor Hong emphasized, "As the complex reaches 50 years, its fertility is depleted. To reinforce it, we are creating a future vision and establishing four strategies. The major core values are creating an innovation ecosystem where companies can innovate well, developing an eco-friendly complex responding to the climate crisis, fostering an environment for continuous learning and research to enhance members' capabilities, and expanding cultural and tourism content to fill the complex with vitality and enjoyment."

Mayor Hong is scheduled to personally announce the future vision and detailed implementation strategies of the Changwon Complex at the 50th anniversary ceremony held at the Changwon Convention Center on the 24th.

A new national industrial complex that will synergize with the Changwon Complex is also being established on the outskirts of Changwon. Selected as a new national industrial complex candidate site by the government in March last year, the 'Changwon Defense-Nuclear Convergence National Industrial Complex' (also known as Changwon National Industrial Complex 2.0) is a new-concept complex centered on large-scale research facilities that companies can jointly use, equipped with technology innovation, talent development, and supply. Preparations for the preliminary feasibility study are currently underway.

Mayor Hong said, "While existing industrial complexes were factory clusters providing land and basic infrastructure such as roads and water supply, the newly established Changwon Defense-Nuclear Convergence National Industrial Complex will be a new specialized complex of the 4th Industrial Revolution era, equipped with industry-academia-research infrastructure. It will have attractive content that companies want, such as state-of-the-art joint research facilities like next-generation advanced composite beam irradiation facilities and systematic talent development and utilization systems linked with local universities. We will meticulously prepare to ensure that the Changwon Defense-Nuclear Convergence National Industrial Complex becomes a core base responsible for South Korea's economic future for the next 50 years," he said.

He continued, "We are living in an era of rapid daily changes. If we do not lead change, we will inevitably fall behind. Therefore, innovation is needed more than ever. In the past, innovation was considered a risk, but now not innovating is the real risk," he stated, adding, "Unlike city-states like Singapore, countries like South Korea with a population of 50 million find it difficult to survive without manufacturing. We will reinforce the fertility of the existing Changwon National Industrial Complex and successfully establish the new Defense-Nuclear Convergence National Industrial Complex to transform Changwon into South Korea's top manufacturing city."

Finally, Mayor Hong said, "We will create a Changwon where constantly innovating companies and talented individuals gather, and citizens are happy," and asked for continued interest and support from the citizens.

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