City to deposit 330 billion won in reserves into integrated management fund next year
Waterfront project alone will need more than 460 billion won going forward
Lawmaker Cho Min-kyung: 'Money not spent this year and money no longer needed are two different things'
![An aerial view of Songdo International City [Incheon Free Economic Zone Authority]](https://wimg.heraldcorp.com/news/cms/2026/09/07/news-p.v1.20260907.95887fcc02534aeba2e4348da3053f0e_P1.jpg)
Incheon Metropolitan City has sharply cut budgets for major development projects in the Incheon Free Economic Zone, including Songdo, while separately setting aside 330 billion won ($244 million) in reserves to be deposited into the city's integrated management fund — a move that stirs controversy over the appropriateness of its fiscal management.
Critics have raised concerns that the city may be treating funds earmarked for future development in Songdo International City, which remains unfinished, as general-purpose liquidity for the city's broader finances.
Cho Min-kyung, a lawmaker on the Incheon City Council's Industry and Economy Committee representing Yeonsu-gu, raised questions about the fiscal rationale behind depositing 330 billion won from the free economic zone's special account into the integrated management fund while reviewing the second supplementary budget for the 2026 free economic zone project.
According to Cho, a central concern is that the same supplementary budget also cuts funding for major Songdo projects by about 77.3 billion won, or 15.5 percent.
The reductions include 30 billion won from the Songdo Waterfront development project, 12.2 billion won from a scale-up of the Songdo sewage treatment facility, 13 billion won from construction of the K-Biotech Lab Hub, 8 billion won from the Landmark City No. 3 waterfront park, and 8 billion won from the second phase of the Landmark City No. 1 waterfront park.
In other words, the city is cutting project spending on one hand while on the other ring-fencing 330 billion won in reserves — intended for use in 2027 free economic zone projects — and transferring it to the integrated management fund.
If the city has sufficient fiscal room and is simply parking future project funds temporarily, the concern may be limited.
Songdo already has an enormous pipeline of follow-on investment, however. The Waterfront project is the most prominent example.
The Waterfront project runs through 2030, and based on the revised continuing-cost plan alone, it will require an additional 105.87 billion won in 2027 and 359.49 billion won from 2028 onward — totaling about 465.4 billion won needed after 2027.
On top of that, additional development projects remain, including infrastructure for Songdo Zone 11 and public sewage treatment facilities.
Cho questioned why the city would deposit 330 billion won in development funds into the integrated management fund when hundreds of billions of won in projects still lie ahead.
"If these are funds needed for future development, the city should first calculate the required amounts by project and by year before deciding how much to deposit," Cho said.
She added that the city needed to provide a clear explanation of "whether immediate disbursement would be possible when the funds are needed for free economic zone projects, and whether there is any risk that repayment could be delayed due to fiscal conditions or competing priorities."
Cho noted that the Waterfront project alone is set to require more than 460 billion won in investment after 2027, yet even as 330 billion won is being deposited into the integrated management fund, no detailed annual plan has been presented for the 359.49 billion won in post-2028 investment.
"Tying up future development funds for unfinished Songdo projects elsewhere, with a promise to return them when needed, risks disrupting the development schedule," Cho said. "The city must not treat the free economic zone's future development funds like a piggy bank it can dip into whenever it pleases."
gilbert@heraldcorp.com
