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[2012] Mayor’s Speech

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  • Sharing Economy Represents a New Opportunity for the Future

  • SMG 959

    Presentation for the media on Sharing City Seoul

    Date: September 20, 2012
    Venue: Briefing Room, Seosomun Building, Seoul City Hall

    Today I will talk about the launch of “Sharing City Seoul,” and would like to share my thoughts with all citizens here. Change cannot occur unless there is sympathy among the people, shared perception of reality, and citizen participation.

    But, what is “sharing”? It is the collaborative use and consumption of goods and services, whereby we designate resources exclusively for shared use and identify the value and enhance the efficiency of such resources. This is the purpose of sharing.

    However, the concept of “sharing” that is emerging as an alternative for future development is not a totally new idea. We have long lived with a deep-rooted culture of sharing in our lives. Only a few decades ago, there were few households that owned television sets. So, villagers often gathered in one home to watch television programs. Such sharing of resources was essential and natural. Although it was initially a means of dealing with poverty, sharing television sets consolidated solidarity among neighbors and created a foundation for autonomous, human-focused welfare.

    In the past, we often shared our meals with neighbors, but sharing should go beyond simply doing a good deed. We need to formalize and institutionalize such acts of “sharing”.

    Also, traditionally, when residents held a big event in their neighborhood, everyone lent a helping hand. However, due to industrialization and urbanization, and the resulting transformation of our society, this culture of sharing has disappeared. Now, we do everything on our own, living more solitary lifestyles.

    Lately, the era of sharing has been making a comeback, prompted by the global financial crisis triggered by the United States in 2009. And the sharing economy, which is based not on possession but on sharing, has begun to emerge. It began in San Francisco, where IT infrastructure was well-established and ready to become the basis of the sharing economy. For me, this was truly impressive. Airbnb, which shares accommodations for travelers on the Internet, facilitates tens of thousands of transactions every day, with one million users in 27,000 cities in 192 countries a year. Tool Library, which lends tools and equipment and shares skills—thereby going beyond simple lending—can now be found in 50 public libraries throughout the United States. And Zipcar, which facilitates the sharing of cars, is now a well-established model business.

    The automobile is evolving from an object of ownership to one of sharing, leading U.S. automakers to begin investing and collaborating with car sharing companies. This will be the way of the future.

    As you see, sharing ventures are all based on IT, which has made sharing and accessing information remarkably easy. This is the foundation on which the sharing economy has firmly established itself as a successful business model. Harvard Law School Professor Lawrence Lessig defined the sharing economy as “collaborative consumption by sharing, exchanging, renting, and utilizing goods, rather than possessing them.” And discussions on the sharing economy have begun to expand among academics.

    Seoul citizens are already enthusiastically pursuing the sharing economy. Sharing cars through Green Car, sharing clothes through Kiple, sharing food and exercise through Zipbob, and sharing travel accommodations through BnBHero, the citizens of Seoul are driving the growth of sharing companies in Korea.

    “The age of ownership has ended, and a new age of access is dawning,” said Jeremy Rifkin, the author of The European Dream. Now, scholars around the world are turning their attention to the sharing economy. In 2009, Time Magazine selected “collaborative consumption through sharing” as among the 10 ideas that will change the world.

    But why does the Seoul Metropolitan Government favor the idea of sharing? Seoul City sees the sharing economy as a new economic opportunity for the future, believing that the dissemination of a sharing culture can restore relationships and communities that have been lost for decades and help reduce the social costs and municipal budget being spent on urban safety and welfare.

    A city is a platform for sharing, and so far, cities have built the infrastructure for “first-level sharing,” i.e. roads, parks, markets, houses, and libraries.

    Now the time has come for “second-level sharing,” where we share information and knowledge as well as physical things and space. Therefore, urban policy should be extended to include second-level sharing. Rather than studying for our own benefit or discarding things that we do not use, we should allow others to use them or find new purposes for them. That is the meaning of a sharing society, sharing economy, and Sharing City Seoul. Such sharing will bring greater benefit to all of us.

    First of all, the Seoul Metropolitan Government plans to begin sharing by making its resources, as well as those of the gu offices and affiliated organizations, open to the public. It will also launch the Open Seoul Project, which comprises all policies and projects based on the philosophy of sharing. So far, the gu offices of Seoul have opened 216 auditoriums and conference rooms for public use since early July, and by December, we plan to open an additional 500 spaces. Also, 52 idle lots of land will be utilized for the construction of rental apartments, dormitories, parks, and fitness centers. In addition, the Seoul Metropolitan Government is now operating 23 “toy libraries” for children. On October 6, the official residence of the mayor will be opened to the public, and everyone is invited. For the sake of transparency, we have already opened an information communication square through which administrative information, public data, and conference materials are being shared with the public. We will continue to increase the volume and types of resources made publically available.

    Sharing public information and data promotes confidence and transparency in our society. Moreover, citizens are given the opportunity to create significant added value by utilizing such public information. In order to make the most of the public information disclosed by the Seoul Metropolitan Government, various IT professionals held an “app creation camp,” where mobile application and internet-based services that directly benefit citizens were created. For example, “Happy Space,” which won the top prize at the Social Innovation Camp, is a platform for the sharing of spaces that uses information on unused spaces at public institutions provided by the Seoul Metropolitan Government. Going forward, I expect that this platform will attract interest from the private sector as well as public institutions.

    I would now like to give you a little more detail about the potential impact of sharing. If 10 percent of Seoul citizens participated in a parking lot sharing program, the benefit would be equivalent to the creation of parking spaces for an additional 3,725 vehicles and savings of KRW 186.2 billion. With the steady increase in the number of international tourists, demand for accommodations is expected to exceed supply by 15,000 rooms. But, if 1,000 households participated in a private accommodation sharing program, the benefit would be equivalent to building 20 hotels with 50 guest rooms each. Such a program would offer retired baby boomers with an opportunity to engage in new economic activities. Furthermore, the sharing of 500 unused spaces, such as auditoriums or conference rooms, owned by public institutions would be equivalent to building 25 new community centers with 10 lecture rooms each.

    Though the Director-General of Seoul Innovation will explain this in more detail after me, the economic effect of the nine Sharing City Seoul projects to be implemented in 2013 is estimated to be KRW 167.5 billion, with an investment from the Seoul Metropolitan Government of only KRW 1.6 billion.

    Sharing City Seoul cannot be realized through the efforts of the Seoul Metropolitan Government alone; it requires the participation of citizens as well as the private and public sectors. When the concept of sharing has been disseminated to diverse areas—businesses, communities, and gu offices—it will help solve economic, social, and environmental issues, and create new value. In particular, the Seoul Metropolitan Government will lend support to those gu offices that actively join this effort.

    This announcement is only the beginning. As Seoul turns the first page toward becoming a Sharing City, we will devise various methods and establish systems with the goal of facilitating citizen participation.

    I trust in the capabilities of our Seoul citizens. Thank you.