[Yonhap]
[Yonhap]

A leading German newspaper has warned that Jeju Island is "at risk of suffocation" from the surge of Chinese tourists and capital, raising concerns that stretch beyond tourism and real estate development to national security.

The Süddeutsche Zeitung recently ran a piece headlined "An island is at risk of suffocation," examining how Jeju has changed since Chinese investment began flowing in.

The paper described an island where Chinese is easily heard on the streets of Jeju, on restaurant menus and in duty-free advertisements. It went on to say that the concentration of Chinese tourists and investment capital in certain areas has fueled growing unease among some local residents.

The investment immigration regime lies at the heart of how Chinese capital first took hold on the island.

To attract foreign investment and stimulate the local economy, the government introduced a real estate investment immigration program in Jeju in 2010. Under the scheme, foreigners who invested 500 million won ($374,000) or more in Ministry of Justice-designated properties were granted residency, with permanent residency available after maintaining the investment for a set period.

As property prices rose and concerns mounted over haphazard development and the concentration of investors from a single nationality, the government in 2023 raised the investment threshold from 500 million won to 1 billion won. The program was also renamed from the "real estate investment immigration regime" to the "tourism and resort facility investment immigration regime."

Total investment flowing into Jeju through the program from 2010 to 2022 reached approximately 1.26 trillion won, of which Chinese investors accounted for roughly 98 percent. Of the 683 people who obtained permanent residency through the program during that period, about 90 percent were also estimated to be Chinese nationals.

The Süddeutsche Zeitung noted that Chinese investors had poured more than 800 million euros ($929 million) into Jeju since 2010, but said the large-scale development had not necessarily produced positive outcomes for local communities.

Some projects stalled or fell into disrepair, the paper said, and controversies over rising property prices and unplanned development followed. It also highlighted residents' criticism that tourism infrastructure has come under strain as visitor numbers surpass 10 million a year, and that profits earned by Chinese-affiliated companies on the island have not been adequately returned to the local economy.

This is not the first time foreign media have turned a spotlight on Chinese capital in Jeju.

Taiwan's Liberty Times reported in June 2024, under the headline "Is Jeju Island becoming a Chinese island? Korea scrambles to cope," on how Jeju emerged as a prime destination for Chinese tourists and real estate investors following the introduction of visa-free entry and the investment immigration program.

That report noted that Chinese-owned land in Jeju stood at roughly 9.81 million square meters as of late 2019, accounting for 43.5 percent of all foreign-owned land on the island.

Jeju Island authorities, however, rebuffed interpretations that Jeju had "become a Chinese island" as an overreach.

They noted that the 9.81 million square meters held by Chinese nationals amounts to just 0.5 percent of Jeju's total area of roughly 1,850 square kilometers. In fact, while Jeju's 2019 statistics showed Chinese-owned land held the largest share of all foreign-owned land on the island, it still accounted for less than 1 percent of Jeju's total area.

Jeju authorities have also maintained that the investment immigration regime does not allow foreigners to freely purchase ordinary apartments or village land in exchange for permanent residency. Eligible investments are limited by law to designated facilities such as resort condominiums, accommodation facilities and tourism pensions within designated tourism complexes and tourism zones.

Experts described the issue of Chinese capital investment in Jeju as a clash between two competing concerns: the potential for foreign investment to invigorate the local economy on one hand, and worries over haphazard development, inadequate economic returns to the community and security risks on the other.


rainbow@heraldcorp.com