The Songdo international business district in the port city of Incheon has been chosen as the headquarters of the secretariat of the UN Green Climate Fund. Songdo beat Bonn, Germany and Geneva, Switzerland in a secret vote by the GCF board on Saturday.
The GCF is a UN agency that collects donations from advanced nations and uses the money to help developing countries cut their greenhouse gas emissions and adapt to climate change. In 2020, the GCF aims to collect more than US$100 billion a year.
The GCF is the first major international organization to be headquartered in Korea. It is expected to play a bigger role as climate change and energy issues will become the overriding issues on the international stage in the 21st century, as the eradication of poverty was in the 20th. The GCF secretariat will be launched next year with several hundred employees, but is highly likely to develop into a super global aid organization replacing the World Bank (12,000 staff) and Asian Development Bank (3,000).
Unlike hosting a one-time international event like the Olympics, being chosen as the host city of the headquarters of a major global organization leads to the relocation of a huge number of people to the host city and a constant influx of foreign visitors. This creates jobs and boosts the chances of more Koreans entering global organizations.
Songdo has been designated as a free economic zone, but there has been a mere trickle of foreign investment. This has resulted in vast tracts of gleaming office towers and residential buildings lined up along empty streets in the sparkling new city overlooking the West Sea. The city has tried to attract the research and development centers of foreign multinationals, foreign universities and research institutes, but it has so far failed to appeal to foreign investors because it lags behind Hong Kong and Singapore in terms of urban infrastructure such as hospitals and schools and tax incentives for foreign businesses.
Now that the GCF is moving in, the central and city governments must radically cut red tape so that hospitals, international schools and hotel can be built in Songdo to cater to foreign residents. Transportation, shopping and other facilities must also be improved to create a living environment as good as global cities like Geneva, New York, and Paris.
Other international organizations may well open an office or move their headquarters here when they see how well the GCF fares here. The move of the GCF secretariat will be a litmus test for whether Korea can become a new regional hub for international agencies.