'Like Austin, Texas': Pilot special zones essential for 3 mega-projects to take root, forum hears

Industry, academia, research institutions and government officials have called for sweeping deregulation and tailored living conditions to support the government's "Three Mega-Projects for Korea's Great Leap Forward," which includes major semiconductor investment.

The Korea Chamber of Commerce and Industry co-hosted a forum Wednesday with the Office for Government Policy Coordination and Pohang University of Science and Technology (Postech), under the theme "Solutions for Regional Balanced Development and AI Growth."

Lee Jung-hee, a professor at Chung-Ang University who delivered the keynote, said that for the three mega-projects to take root, "pilot special zones must be established that bundle regulatory exemptions, public demand, computing resources, data, talent and living conditions." He added that such zones would enable diverse AI experimentation, and that "the kingpin — the core element — can be summed up as regulatory rationalization."

Lee cited Austin, Texas, as a model — a city that grew by attracting a high-tech research consortium in the 1980s. Austin's real GDP roughly tripled over the 20 years following 2002, and Tesla relocated its headquarters there in 2021.

"The result of a tax environment with virtually no personal or corporate income tax, combined with education and research investment anchored at the University of Texas at Austin, drew a diverse range of competing companies and startups," Lee said. "It is a case that demonstrated through market principles the virtuous cycle in which a business environment attracts businesses, businesses create jobs, jobs draw talent, talent drives settlement, and settlement in turn attracts more businesses." He went on to say the government should "use the mega special zones it is pursuing as a vessel for innovation."

Lee Hyung-hee, vice chairman of the Seoul Chamber of Commerce and Industry, also called for regulatory rationalization and government support, saying that "to generate growth through AI — which determines the life and death of companies — many experiments and a well-equipped laboratory are needed." Kwon Hye-rin, head of the National Land Grand Transformation Policy Task Force at the Office for Government Policy Coordination, said that if the three mega-projects — semiconductors, AI data centers and physical AI — are the engine to innovate the industrial ecosystem, then the national land transformation is the core execution strategy that spreads that energy across the country to complete balanced national development.

Companies and experts also urged tailored support for successful regional implementation. Shin Seung-gyu, executive vice president of Hyundai Motor Group, said that for the group's Saemangeum project to succeed, "infrastructure development must proceed in parallel — including designation as an RE100 industrial complex, deregulation through the mega special zone framework, and construction of a robot cluster" — and called on the government for support.

Bae Young, a professor at Postech, said that "to prevent a pattern where people simply commute from the greater Seoul area, fundamental thinking about living conditions is needed," and called for building a predictive model for "youth settlement potential" using population movement data and tailored interviews with younger generations.

Hong Sa-heum, head of the Global Development Cooperation Center at the Korea Research Institute for Human Settlements, warned that because AI has strong agglomeration externalities, without a separate balancing mechanism it could actually intensify concentration in the greater Seoul area. He recommended fine-grained policy management, including priority and differentiated support for non-metropolitan regions. Kim Dong-hwan, chief executive of 42Maru, urged multifaceted support so that AI talent can be cultivated and supplied locally, centered on regional hub universities.

Kwon Jin-woo, head of the Urban and Housing Research Division at the Gyeonggi Research Institute, said regional balanced development must mean support for non-metropolitan areas and must not take the form of regulations on the greater Seoul area. He added that the moment calls for a strategic government choice — one that establishes spatial planning criteria such as threshold population and wide-area transportation, alongside hub development and incentives.