BUSINESS

US state rises as main investment destination for global businesses

By Song Su-hyun

Buoyed by incentives, SK innovation ready to break ground in Georgia

  • Published : Mar 6, 2019 - 18:21
  • Updated : Mar 7, 2019 - 14:38

On March 19, South Korea’s SK Innovation is breaking ground for an electric vehicle battery plant in Georgia in the United States, in what is touted as the largest-ever foreign business investment for the state.

The Korean energy and chemical business is slated to construct the $1.67 billion manufacturing facility with an annual production capacity of 9.8 gigawatt-hour EV batteries in the city of Commerce within the southeastern state. 

Gov. Brian Kemp delivers his inaugural speech in January. (State Government of Georgia)

Owing to ample incentives offered by the state government, SK Innovation has pinned high hopes on expanding its investment to the US state to as much as $5 billion, if the plant sees orders for EV batteries increase in the next few years. 

Georgia has been rising as a strategic base for manufacturing facilities of global businesses, considering it is part of the so-called “Eastern Sunbelt” along with Tennessee, Alabama and South Carolina, according to the US Department of Labor.

It is home to Lockheed Martin, Gulfstream, Tata Group, Kia Motors and Hanwha Q Cells. 

The US state offers various incentives for incoming businesses. 

Its financial incentives range from reductions and exemptions from corporate and local taxes to public utility bills so low that they amount to nearly zero. 

Administrative procedures related to the construction of production facilities, which include dealing with complaints from local entities, are simplified for the companies. 

Tuition fees for state universities will be halved for children of foreign business executives and employees. And they will also be exempted from banking transaction fees. 

The business-friendly mood is expected to continue unabated under Gov. Brian Kemp, who took office in January. Kemp, 56, is a businessman-turned-politician who entered politics in 2002 by being elected to the Georgia State Senate. 

Since his election, Kemp has highlighted his business-savvy leadership, pledging for new economic opportunities and building up rural communities, such as by reviewing regulations that hinder companies from hiring and investing.

In his inaugural speech, Kemp also expressed high expectations for SK Innovation’s arrival in the state, saying he hoped the Korean firm would contribute to the local economy by creating around 2,000 new jobs. 

“Including the massive incentives by the state government, the business-friendly environment across the state and an anti-labor union sentiment is highly attractive to global companies like SK Innovation,” said an official at a Korean company. 

“After Kemp’s inauguration, both the state and city governments have become very supportive of SK Innovation’s construction of the EV battery plant.”

By Song Su-hyun (song@heraldcorp.com)


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