The Gateway to Asia's Golden Opportunity
Yesterday, in a little-noticed tape-cutting ceremony, the American logistics giant DHL joined an exclusive club whose members include General Douglas MacArthur, Kublai Khan and invading Samurai hordes.
For hundreds of years, anyone seriously interested in either political or economic control of Northeast Asia has quickly spotted the extraordinary geographic power of the Korean port of Incheon.
For history's military planners, there have been complex naval and land-based strategic motives. For the likes of DHL and other 21st-century corporate planners, there is a simpler formula at work: a third of the world's population, 2.1 billion people, live within a 3½hour flight of Incheon's shiny new airport.
DHL's $100 million (£49 million) investment in building a Northeast Asian hub in Incheon puts it among a growing band of international companies laying down hefty markers in a city that could, if all goes according to plan, find rich pickings as a gateway between China, Japan, Russia and South Korea. It may even, if relations between North and South Korea continue their glacial improvement, become the commercial centre of a more cooperative peninsula.
The attractions of Incheon have long been obvious. It is South Korea's second-busiest commercial seaport and has on its outskirts the country's main international airport. South Korean industry, including heavy manufacturers such as Daewoo and Posco, has already settled there. The central government, sitting an hour's drive away in Seoul, appears to be doing everything that it can to entice foreign investment by designating Incheon a Free Economic Zone in 2003, scything tariffs in the area and investing heavily in infrastructure.
Since then, more than $37 billion of overseas investment has flowed into Incheon, but even the city's most ardent supporters admit that foreign enthusiasm has taken a while to come to the boil. Some argue that it is not there yet.
There remains fiddly regulation to contend with. Relative to the five-day process on offer in China, for example, registering a new company in Incheon takes about nine months. There is also the nagging perception that South Korean attitudes to foreign investors can, with a sudden thrill of nationalism, turn on a sixpence. Private equity investors in Korea's financial sector have been the most recent victims of this: one of them, Lone Star, is locked in a bitter court battle.
Yet it is hard to deny the energy and optimism being poured into Incheon, which remains a fairly grimy industrial metropolis. The Free Economic Zone comprises three main areas, whose combined size covers an area equal to about a third of Singapore. Each area will get expansive infrastructure projects that have already begun to transform the business environment. AMEC, the British group, is constructing a 12.3km (7.6mile) bridge, Jack Nicklaus has designed a golf course and both the harbour and airport are being dramatically expanded to handle more trade.
Incheon is, perhaps, the vanguard of South Korea's wider ambitions. The economy has grown impressively to become the world's eleventh-largest, but there is a deep desire for acknowledgement. When Free Economic Zone (FEZ) planners in Korea talk about the construction of a "Hongapore", it is because they are desperate to win investor attention.
There is also an element of jealousy: Hong Kong and Singapore seem to have an edge in promoting the type of imaginative technological advances that Korea knows it needs to remain competitive in the Japan-China sandwich. Incheon is a tacit admission that, back in Seoul, Korean business culture may be stifling the very forces the country needs to nurture.
"FEZs are special economic zones designed to spearhead growth of the Korean economy by easing regulations and institutional restraints undermining business," a Finance Ministry official said. "The Government envisages inviting foreign businesses and developing them into international open cities." Incheon also symbolises the Korean passion for the grand vision, the sort of blueprint dreams that, in Asia, demand towers. Vast steel-and-glass towers. Accordingly, Incheon will be the site of twin 77-storey world trade centre buildings due for completion in 2015, as well as a soaring 150-storey tower that should be the second-tallest in the world by the time it is finished. Tenants for the trade centre are expected to include big financial players, such as Lehman Brothers and Credit Suisse.
The New Jersey-based Gale International has already ploughed $5 billion into what remains an expanse of reclaimed mudflats around Incheon.
"Real estate is all about location, and Korea's strategic location is its first attraction," John Hynes, Gale's chief executive, said. "Then there is the Government's vision for an international business centre, a vision backed up by $10 billion in infrastructure improvements to the area."
Facts and figures
Origin of name: established in 1413 during the reign of King Taejong of Joseon. Its port was founded in 1883, when the city was called Chemulpo. At that time, the population was only 4,700
Area: 964.53 sq km
Population: 2.63 million
Population density: 2,725 people/sq km
Exchange rate: £1 equals 1.88 South Korean won
Cost of living: A loaf of bread costs 1.6 won
Transport infrastructure: Incheon is the second-largest seaport in South Korea, after Pusan. Incheon Port Authority will spend $2.2 billion (£1 billion) on building a new container pier to more than triple container cargo volumes by 2013
Climate: average annual temperature 11.4?C. January average is minus 3.1?C, August is 24.9?C
Visa regulations: European Union citizens must obtain a South Korean visa before depature
Timezone: GMT+9 hours
Website: english.incheon.go.kr
Airlines: British Airways offers a direct service to Seoul-Incheon airport. Other airlines flying the route include Korean Air and Asiana Airlines