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With Russia Primorsky Krai 2016/17 Knowledge Sharing Program (Industry & Trade) with RUSSIA PRIMORSKY KRAI 2016/17 Knowledge Sharing Program (Industry & Trade) with Russia Primorsky Krai Project Title Russky Island Development Strategy and Investment Promotion Plan Prepared by Institute of Eurasian Studies Kookmin University Supported by Ministry of Strategy and Finance (MOSF), Republic of Korea Korea Trade-Investment Promotion Agency(KOTRA) Prepared for Government of the Russian Federation In cooperation with Government of Primorsky Territory, Russia Far Eastern Federal University, Russia Far East Development Fund, Russia KOTRA Vladivostok Office Project Directors Won Sok Yun, Executive Vice President for Biz info & Trade, KOTRA Sang Young Hong, Director General, Development Cooperation Office, KOTRA Senior Advisor Dong Gyu Shin, Senior Advisor and Head Delegation of KSP Consultation Project Manager Ji Won Lee, Manager, Development Cooperation Office, KOTRA Project Officer Yi Rye Kim, Researcher, Development Cooperation Office, KOTRA Authors Sang Joon Lee (Principal Investigator, Director of the Institute of Eurasian Studies, Kookmin University) Dong Wuk Kim (Jeju National University, Professor) Seong Hak Yoon (Korea University, Professor) Hyundeok Im (Researcher, Hankuk University of Foreign Studies) Seul Gi Park (Researcher, Hankuk University of Foreign Studies) Yoo Jin Jung (Researcher, Hankuk University of Foreign Studies) Alexander Abramov (Professor, Far Eastern Federal University) Roman Dremliuga (Professor, Far Eastern Federal University) Government Publications Registration Number 11-1051000-000802-01 ISBN 979-11-6097-659-5 (93320) 979-11-6097-660-1 (95320)(PDF) Copyright ⓒ 2018 by Ministry of Strategy and Finance, Republic of Korea RUSSIA PRIMORSKY KRAI 2016/17 Knowledge Sharing Program (Industry & Trade) with Russia Primorsky Krai Russky Island Development Strategy and Investment Promotion Plan 2016 KSP (Industry & Trade) with Primorsky Government, Russia Overview Chapter 1. Jeju’s Development and Demands in Developing Russky Island Chapter 2. Improving the Development Plan & Investment Promotion Model for Russky Island Preface The Knowledge Sharing Program (KSP), sponsored by the Ministry of Strategy and Finance, is the representative knowledge-based development cooperation program in Korea that supports the economic and social development of partner countries and establishes a friendly economic cooperation base with Korea. KSP has been used strategically for economic cooperation and the demand for creating new growth engines in overseas markets has increased in recent years. As such, KOTRA has been participating as a joint general organization of KSP since 2014, providing advice to promising industries such as trade and investment and contributing to the project, making KSP a cornerstone of bilateral economic cooperation. KOTRA has been carrying out nine KSP projects including KSP in the Primorsky Krai Province as a general organization of the ‘2016/17 KSP Industrial and Trade Investment Policy Advisory Program’ and focuses on the following two aspects. First, we emphasized the importance of knowledge sharing gained during the economic development process of Korea with partner countries and provided meaningful policy advice in accordance with KSP’s goals. Rather than delivering the experience of Korea to partners unilaterally, KOTRA sought to find common implications through communication and cooperation with various participants, including senior officials of partner countries. Second, we have improved the effectiveness of policy advice by upgrading the KSP project to lead to practical economic cooperation and allowing Korean companies to participate. With the second Eastern Economic Forum in September 2016, President Putin expressed his commitment to develop Russia’s Far East, including Russky Island, as an advanced science technology and education hub in the Asia-Pacific region. This led the Primorsky government to ask the Korean government for policy advice on establishing the development concept of Russky Island by benchmarking Jeju Island. In this context, KOTRA conducted an industrial and investment KSP policy consultation with Kookmin University’s Institute of Eurasian Studies under the subject of “Establishing the Concept of Development of Russky Island Development Area”. This report shares the development experience of Jeju Island and contains a strategy to create an advanced science technology and international education center (MICE center) by utilizing the available resources and research capacity inside Russky Island, such as Far Eastern Federal University. In order to develop into an advanced science and innovation complex, Far Eastern Federal University created a high and advanced science cluster with the competence of IT (Information Technology), BT (Biotechnology) and MT (Marine Technology). The Korean government also established the Korea-Russia Technical Cooperation Center and proposed the promotion of cooperation between the two countries in the science and technology field. Additionally, if Russky Island will be the Territories of Advanced Social and Economic Development (TASED), a synergy effect is expected to be created by connecting Russky Island TASED with the Vladivostok Free Port (trade), Nadezhdinsky(production), Mikhailovsky (farmhouse) and Partizansk (petrochemical). Based on the development experiences of Jeju Island, we proposed the coordination plan for providing the development fund of the Russian government and/with the entry plan of Korean companies to the Far East by the using of the Korea-Russia investments and loans platform. The result of the Primorsky Krai KSP policy advisory based on the knowledge gained from the development experiences of Jeju Island was reflected in the development concept (report) of Russky Island prepared by the Primorsky Krai government and then submitted to the Federal government in April 2017, which was finalized by Prime Minister Dmitry Medvedev in early June. KOTRA has served as a point of contact between the two countries to assist in the recruitment of domestic investors for the establishment of the Russky Island International Cooperation Center, which was established by the Far East Development Fund as a follow-up to KSP. Prior to the publication of this report, I would like to express my sincere appreciation to Mr. Sang-Joon Lee, principal investigator and director of the Institute of Eurasian Studies of Kookmin University; Mr. Dong-Wuk Kim, professor at Jeju National University; and Mr. Seong-Hak Yoon, professor at Korea University for sharing the experiences of Korea's economic development. I am also grateful to the former president of NH Financial Group Mr. Dong-Gyu Shin, senior advisor and head of delegation to the KSP Consultation; the Primorsky Krai government; the Far East Development Fund; Far Eastern Federal University; KOTRA’s overseas office in Vladivostok and the Korean Consulate General in Vladivostok. Furthermore, I am thankful to those who have offered valuable advice for the completion of the report, including Mr. Wan-Suk Hong, Mr. Young-Kwan Jo, Mr. Young-Jin Kim, Mr. Dong-Sun Lee and Mr. Hwan-Jun Lee. Lastly, I’d like to disclose that the contents of this report are opinions of experts who participated in the project, and are not official opinions of KOTRA. August, 2017 Wonsok Yun Executive Vice President for Business Information & Trade Affairs, KOTRA Contents 2016 KSP (Industry & Trade) with Primorsky Government, Russia ······························· 1 Overview ··································································································································· 9 Chapter 1 Jeju’s Development and Demands for Developing Russky Island 1. Comparison of Russky Island and Jeju Island ············································································· 20 1.1. Natural Environment & Endowment Factors ········································································ 21 1.2. System & Policy Factors ·········································································································· 23 2. Development of Jeju Island ············································································································ 24 2.1. Analysis of Jeju’s Economic and Industrial Structure ·························································· 24 2.2. Jeju International Free City Development Process ······························································ 29 2.3. Jeju’s Development System & Improvements in Investment Environment ··················· 35 2.4. Jeju’s Major Development Projects ························································································ 46 3. Demands in Developing Russky Island ·························································································60 3.1. Russky Island Economic and Industrial Structure Analysis ················································· 60 3.2. Russky Island Development Preparation Course ································································· 65 3.3. Development System and Improving Investment Environment ······································ 70 3.4. Major Development Projects ··································································································· 74 3.5. Development Environment Comparison of Russky Island and Jeju Island ····················· 79 Contents Chapter 2 Improving the Development Plan & Investment Promotion Model for Russky Island 1. Imporving Russky
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