SEOUL, Korea – The southern resort island of Jeju is booming, posting the country’s highest growth rate in private consumption, service industry productivity, employment and exports last year, according to Statistics Korea.
Major businesses are relocating their headquarters to the island and people are moving there from the mainland.
In 2004, Daum Communications (now Kakao) moved its headquarters to Jeju, followed by some 50 other companies, mostly IT or game businesses such as NXC and ESTsoft, increasing the populations significantly. Booming tourism, meanwhile, has created more jobs in the service and construction sectors.
Jeju’s service industry output in 2015 increased 6.1 percent compared to the previous year, which was more than twice the national average of 2.9 percent. As 3,000 to 4,000 people move to the island every year, the real estate sector’s output rose 25 percent to lead overall growth.
Private spending increased 7.8 percent last year, again more than double the national average of 3.4 percent. That too was due to the huge increase in the number of people arriving on the island each year, either to settle or for a visit.
Retail sales at shopping centers and duty-free shops rose 9.5 percent in 2015, three times the national average of 3.6 percent. Thanks to tourists renting cars, fuel consumption on the island surged 16.9 percent.
Jeju Island was also the only region to post double-digit export growth last year with outbound shipments rising 13.8 percent. In contrast, the exports of 12 out of 17 major cities and provinces shrank.
The main cause of Jeju’s booming economy is the steady increase in tourists and settlers from the mainland. Its population grew from 606,000 in 2014 to 623,000 last year. The number of tourists also rose by 1.4 million over the same period to 13.66 million last year.
Jeju city official Kim Hyun-cheol said, “Drawn by the pleasant living environment, many celebrities have moved to Jeju, which resulted in a wide range of other people from the mainland coming to run their own businesses here.”
He added that the island’s international school admits Korean students without the restrictions found in Seoul, which has led to an influx of kids and their parents from elsewhere.
But with the increasing population, real estate prices on the resort island are skyrocketing. The average real estate price on the island rose 19.35 percent last year, five times the national average. The prices of some apartments are showing signs of overheating.