Lawmaker Kang Jun-hyeon: SMEs received only 11% of 18 trillion won approved; incentives needed for firms moving out of capital region

KDB Chairman Park Sang-jin: Venture firms are South Korea's future; fast-track review to streamline approvals

Democratic Party of Korea lawmaker Kang Jun-hyeon questions Korea Development Bank Chairman Park Sang-jin during a comprehensive national audit session Thursday. [National Assembly TV screen capture]
Democratic Party of Korea lawmaker Kang Jun-hyeon questions Korea Development Bank Chairman Park Sang-jin during a comprehensive national audit session Thursday. [National Assembly TV screen capture]

Korea Development Bank Chairman Park Sang-jin said Thursday he would actively review a plan to offer incentives to companies relocating outside the Greater Seoul area under the 150 trillion won ($113 billion) National Growth Fund.

Speaking at a comprehensive national audit of the National Assembly's Political Affairs Committee, Park responded to a question from Democratic Party of Korea lawmaker Kang Jun-hyeon, who asked whether the fund would establish separate incentives for companies moving to non-metropolitan regions. "As you noted, we need to actively review this and work out a system," Park said. No such incentives currently exist under the National Growth Fund.

According to Kang, the fund has approved 18 trillion won ($13.6 billion) for 35 companies toward its overall target of 150 trillion won. Support for companies outside the Greater Seoul area accounted for 44 percent of that total, exceeding the 40 percent threshold set under USFKI 5200.08. Support for small and medium-sized enterprises, however, was limited to 2 trillion won, or 11 percent of the total.

"Funding tends to be concentrated in large and mid-sized companies," Kang said. "We need to identify and nurture future growth engines, and that means there is a real need to support small and medium-sized enterprises and venture firms."

Park said he agreed completely. "I believe venture companies are the future of our country," he said. He added that he would actively pursue two measures: supporting an indirect-investment fund expected to reach around 10 trillion won this year, and introducing a fast-track review system to simplify the approval process for small and medium-sized enterprises and venture firms.

Venture companies are set to receive National Growth Fund support through indirect investment rather than direct loans.


won@heraldcorp.com