Global Economic Times

South Korea Urged to Fortify National Land Development Strategy in Preparation for Potential Unification, Drawing Lessons from Germany's Experience: Desk / Updated : 2025-04-20 19:11:43

Seoul – A compelling argument has emerged, emphasizing the urgent need for South Korea to enhance its national land development strategies in anticipation of the potential unification of the Korean Peninsula. This call to action is underscored by the staggering financial burden Germany faced during its reunification, where the integration of East and West Germany incurred an estimated 3.2 trillion Korean won (approximately $2.3 trillion). Given the substantial economic disparity between South and North Korea, the projected costs of unification are anticipated to be considerable.

The Construction Industry Vision Forum convened a seminar on May 17th at the Construction Hall in Nonhyeon-dong, Gangnam-gu, Seoul, titled 'Unified Germany's National Land Development and the Korean Peninsula's National Land Strategy.' The event aimed to analyze the specific costs and outcomes of German reunification and to propose an effective national land development strategy tailored to the Korean Peninsula.

Kim Jong-hoon, Chairman of HanmiGlobal, who sponsored the seminar, stated in his congratulatory speech, "The best solution to address South Korea's most pressing issues, such as chronic low growth and population problems due to low birth rates, is unification. We can create new momentum for enhancing national competitiveness by generating synergy between the two Koreas."

Lee Sang-jun, a senior researcher at the Korea Research Institute for Human Settlements (KRIHS), who presented on the topic, revealed, "Germany invested between 1 trillion euros (approximately 1.6 quadrillion won) and 2 trillion euros (approximately 3.2 quadrillion won) over 20 years post-unification. The federal government's announced investment over 15 years was 1.4 trillion euros (approximately 2.24 quadrillion won), 2.8 times the estimated amount in 1991." According to the data, infrastructure accounted for 12.5% of the total unification costs, and economic revitalization investment support accounted for 7%.

Lee Sang-jun pointed out, "While Germany achieved significant results in infrastructure sectors such as railway modernization and residential environment improvement post-unification, there were significant side effects, including real estate ownership disputes, regional imbalances, and housing vacancy issues. The economic gap between South and North Korea, which is 30 to 1, is much larger than the 3 to 1 gap between East and West Germany. We are facing complex challenges such as population decline and international geopolitical uncertainties."

Kim Min-ah, an associate research fellow at KRIHS, proposed a national land development strategy considering the unique characteristics of the Korean Peninsula. Kim Min-ah emphasized, "We must pursue innovative national land development that reflects carbon neutrality and Sustainable Development Goals (SDGs). Particularly in the development process of North Korea, we need to build the most innovative national land and urban development model in Northeast Asia by incorporating advanced technologies such as smart cities."

She further stated, "Open national land development is crucial to strengthen the Korean Peninsula's position as a hub for continental and maritime exchange. We need to connect the Asian Highway (AH), Trans-Continental Railway (TCR, TSR) with the Korean Peninsula's roads and railways, expand the Northeast Asian port city network, and establish a Northeast Asian energy network."

For national land development financing, she suggested a mix of private and public funding and attracting funds related to SDGs.

Kim Min-ah added, "South Korea should actively consider securing necessary funds through international private capital rather than government finances and seek ways to attract sustainable development funds for advanced technology incorporation, such as smart cities, and water resource infrastructure development in North Korea."

In the subsequent panel discussion, most participants emphasized, "Unification is unpredictable, but preparation is essential. It is crucial to have systematic preparation and diverse private exchanges to address the complex challenges currently facing the Korean Peninsula, such as the economic gap of over 30 times, population aging, climate crisis, and international geopolitical instability."