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Universal Studios project likely to fall through

By Yoon Ja-young

A plan to build a Universal Studios theme park in Hwaseong, Gyeonggi Province, is facing rough going as negotiations aren't proceeding smoothly within the consortium.

According to the Korea Water Resources Corporation (K-Water), the parties to the project are having difficulties reaching an agreement on some issues including how much of a stake each will have in the project.

"We previously announced that the deal would be signed by the end of June, but it is likely to be delayed until August," said a K-Water spokesman.

The statement follows a local media report that the project, which was one of President Park Geun-hye's election pledges, is about to fall through.

K-Water announced back in December that it selected the USK Consortium as the preferred bidder for the project.

The consortium is composed of Universal Studios Korea Property Holdings, Daewoo Engineering & Construction, Dohwa Engineering of Korea and the China State Construction Engineering Corporation. K-Water, Gyeonggi Province, Hwaseong and the Korea Development Bank (KDB) are also participating in the consortium.

K-Water had said that by the end of June they would sign an agreement to open the theme park, which is to be the fifth Universal Studios park, by 2020.

The 5 trillion won project includes a Universal Studios theme park, a golf resort, a water park, a shopping center and condominiums on a 4.2 square kilometer plot.

The project drew attention as it could attract an increasing number of foreign tourists because it is located about an hour from Seoul by car and is close to Incheon International Airport.

According to a media report, however, those participating in the consortium are concerned with uncertainties. Investors doubt the plan will build momentum as the Park Geun-hye administration is heading toward the end of its five-year term.

KDB is also facing restructuring pressure from shipbuilding and shipping companies, for which it is the main creditor, and is sitting on snowballing debt.

The K-Water spokesman said that members of the consortium are having problems reaching a consensus, but stressed that this doesn't mean the project will fall through.

"We expect that a detailed plan will be set in August. It will be announced after the appointment of our new CEO that month. If construction begins around the end of this year as planned, it will open in 2021."

K-Water's former CEO Choi Gye-woon suddenly quit in May, six months ahead of the end of his term. The sudden resignation prompted suspicion that he was pressured to quit so that the post could be taken by a governing Saenuri Party politician who lost in the April 13 general election.

Analysts say that this contrasts with other countries where governments are giving full support to attract global theme parks, such as Shanghai Disneyland and Tokyo Disneyland.

Economists estimate the opening of Disneyland in Shanghai will have a 35 billion yuan (6.2 trillion won) economic effect on China's tourism industry, raising Shanghai's regional GDP by 0.8 percent.

The Universal Studios project in Hwaseong was first led by Lotte Group, but it backed out in 2012 after failing to reach an agreement on the land price with K-Water. "Back then, Lotte had to buy land from K-Water due to regulations, which was too burdensome for Lotte amid the global financial crisis. With a revision of the law, K-Water is now providing the land as an investor," the K-Water spokesman said.

Experts point out that the government should note that theme parks are a major part of tourism infrastructure, instead of pressuring them with a myriad of regulatory hurdles.



Korean Language

한국판 유니버설스튜디오 유치 '난망'…협약체결 지연

경기도 화성에 들어서는 송산그린시티의 국제테마파크에 한국판 유니버설스튜디오를 유치하겠다던 계획에 빨간불이 켜졌다.

20일 한국수자원공사에 따르면 테마파크 개발사업 우선협상자인 '유니버설스튜디오스코리아(USK)' 컨소시엄과 사업협약 체결에 어려움을 겪고 있다.

이달 말까지 사업협약을 마무리 짓고 테마파크 사업을 본격 추진하겠다는 계획은 사실상 불가능해졌다.

2020년 예정된 유니버설스튜디오 준공 시점도 조정될 것으로 보인다.

우선협상자 측과 수자원공사는 사업 주체의 의무사항과 특수목적법인 설립, 운영방안 등에 대해 이견을 보이는 것으로 알려졌다.

수자원공사는 협약체결 기간을 2개월 연장, 8월 말까지 협약체결을 추진하겠다는 계획이다.

USK 컨소시엄은 지난해 9월 시행된 송산국제테마파크 사업자 공모에 단독으로 참여했다.

컨소시엄에는 국내 투자기업 USKPH와 대우건설, 도화엔지니어링, 중국 국영 건설사인 중국건축고분유한공사(CSCEC)와 여행사 홍콩중국여행유한공사(CTS) 등 5개 기업 외에 수자원공사, 경기도, 화성시, 산업은행 등이 참여했다.

USK 컨소시엄은 약 5조원을 투자해 송산국제테마파크에 유니버설스튜디오, 한류테마파크, 워터파크, 콘도미니엄, 골프장 등을 건설하겠다는 계획을 제안해서 우선협상 대상자로 선정됐다.

수자원공사 관계자는 '사업이 완전 무산된 건 아니지만, 협상에 어려움을 겪는 것이 사실'이라며 '사업 주체자가 여럿이다보니 사업에 대한 책임, 의무사항, SPC설립, 운영방안 등에 대한 합의점을 찾는데 한 두 달 정도의 시간이 더 필요할 것으로 보고 있다'고 말했다. (연합뉴스)



By Yoon Ja-young

A plan to build a Universal Studios theme park in Hwaseong, Gyeonggi Province, is facing rough going as negotiations aren't proceeding smoothly within the consortium.

According to the Korea Water Resources Corporation (K-Water), the parties to the project are having difficulties reaching an agreement on some issues including how much of a stake each will have in the project.

"We previously announced that the deal would be signed by the end of June, but it is likely to be delayed until August," said a K-Water spokesman.

The statement follows a local media report that the project, which was one of President Park Geun-hye's election pledges, is about to fall through.

K-Water announced back in December that it selected the USK Consortium as the preferred bidder for the project.

The consortium is composed of Universal Studios Korea Property Holdings, Daewoo Engineering & Construction, Dohwa Engineering of Korea and the China State Construction Engineering Corporation. K-Water, Gyeonggi Province, Hwaseong and the Korea Development Bank (KDB) are also participating in the consortium.

K-Water had said that by the end of June they would sign an agreement to open the theme park, which is to be the fifth Universal Studios park, by 2020.

The 5 trillion won project includes a Universal Studios theme park, a golf resort, a water park, a shopping center and condominiums on a 4.2 square kilometer plot.

The project drew attention as it could attract an increasing number of foreign tourists because it is located about an hour from Seoul by car and is close to Incheon International Airport.

According to a media report, however, those participating in the consortium are concerned with uncertainties. Investors doubt the plan will build momentum as the Park Geun-hye administration is heading toward the end of its five-year term.

KDB is also facing restructuring pressure from shipbuilding and shipping companies, for which it is the main creditor, and is sitting on snowballing debt.

The K-Water spokesman said that members of the consortium are having problems reaching a consensus, but stressed that this doesn't mean the project will fall through.

"We expect that a detailed plan will be set in August. It will be announced after the appointment of our new CEO that month. If construction begins around the end of this year as planned, it will open in 2021."

K-Water's former CEO Choi Gye-woon suddenly quit in May, six months ahead of the end of his term. The sudden resignation prompted suspicion that he was pressured to quit so that the post could be taken by a governing Saenuri Party politician who lost in the April 13 general election.

Analysts say that this contrasts with other countries where governments are giving full support to attract global theme parks, such as Shanghai Disneyland and Tokyo Disneyland.

Economists estimate the opening of Disneyland in Shanghai will have a 35 billion yuan (6.2 trillion won) economic effect on China's tourism industry, raising Shanghai's regional GDP by 0.8 percent.

The Universal Studios project in Hwaseong was first led by Lotte Group, but it backed out in 2012 after failing to reach an agreement on the land price with K-Water. "Back then, Lotte had to buy land from K-Water due to regulations, which was too burdensome for Lotte amid the global financial crisis. With a revision of the law, K-Water is now providing the land as an investor," the K-Water spokesman said.

Experts point out that the government should note that theme parks are a major part of tourism infrastructure, instead of pressuring them with a myriad of regulatory hurdles.

Yoon Ja-young yjy@koreatimes.co.kr

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