As our economics correspondent Lee Soo-jin reports, one way to do that is through something called 'loconomy'. She joins us in the studio to talk about it. Welcome, Soo-jin.
Thank you for having me.
What is 'loconomy'? And why is it the choice to keep small towns alive in South Korea?
Sure, 'loconomy' is a combination of two words 'local' and 'economy'. It aims to stimulate local economies, especially in rural areas, through businesses and products that reflect characteristics unique to that region. And it's being seen as a way to help communities avoid extinction. Even places in Gyeonggi-do Province, the only province that has seen its population increase over the past decade, are in danger of dying out.
A report released earlier this year showed that 30 out of the 31 cities and counties in the province will be at high risk of extinction by 2067. That particular designation is given to areas where the number of those aged 65 and above is more than five times that of women in their 20s and 30s. An expert said that stimulating the local economy by attracting visitors can prevent extinction. Let's take a listen to what he said.
"An influx of visitors that spend money will drastically decrease the possibility of that place disappearing, even if they don't settle down there."
And the best way to draw visitors is 'loconomy' as it will help local businesses, keeping the area alive.
Here's what he said: "The most important thing is to make sure that people living in the area want to stay there trying to directly increase the rural population is unrealistic as of now so this is the most practical option."
What are the examples of places that have been successful in boosting the local economy through this 'loconomy'?
Actually yes one example is Yangyang-gun County, the most popular surfing spot in the nation. Originally a small fishing village, it promoted a feature that made it unique: beaches with the right water depth and consistent waves that make it ideal for surfing. According to Yangyang-gun County Office, Yangyang's surfing population has been steadily increasing, with nearly 470-thousand visitors last year. And the economic impact of its surfing industry was estimated to have almost tripled last year compared to 2019.
What other regions are eyeing on 'loconomy' to give a boost to their own economies?
Sure, so Gaehang is a neighborhood in Incheon that has a long history that can be seen in its buildings. Once a bustling port area, it began fading from people's memories as many began leaving the neighborhood in favor of more modern areas.
So a local group decided to apply loconomy to revitalize the village's economy and save it from dying out by emphasizing the very characteristic that many saw as the root of the problem: its "old-fashionedness." The head of the local group says that he believes that it's the area's old-fashionedness, also reflected in the old corner shops scattered across the village, that holds the key to the town's longevity.
Let's take a listen to what he said.
"I believe that once Gaehang's economy improves and the old corner shop owners make money, they'll pass on their businesses to their children and then the neighborhood will have a lasting history."
So instead of demolishing or redesigning these shops, their "old-fashionedness" was not only preserved but also promoted through galleries and social media to attract visitors. This has already proven effective as local businesses such as this custom wood sign shop are already benefitting from the visitors who are fans of the retro trend.
Here's what the owner of a corner shop said:
"People from Seoul also began to place orders as they discovered my shop on one of their visits to Gaehang." The shop owner said that until recently, he had been tempted to close his business and leave the area altogether, but he decided to stay after seeing how the neighborhood is starting to slowly change. Keeping with the retro trend of the area, he also designed the vintage logo of the local beer. Gaehang beer is also brewed to contain a higher percentage of malt, giving it a taste reminiscent of beer from the 60s and 70s. In response to the rise in visitors who come just to drink this beer as it's sold only in Incheon, the local brewery has also started selling its own merchandise.
While the locals are well aware that there is still much work to be done before Gaehang's economy reaches the level of places like Yangyang, both are a testament to how "loconomy" is creating real economic value.
Alright, thank you for your report today Soo-jin.
No problem, it was my pleasure.
