Ministry of SMEs and Startups Accelerates Smart Reshoring through Fair Automation

[Asia Economy Reporter Moon Hyewon] The Ministry of SMEs and Startups announced on the 24th that it is accepting applications from companies wishing to participate in the Process and Quality Technology Development Project (Innovative R&D, Advancement) to actively promote domestic production of wiring harnesses, non-contact thermometers, and infusion sets, which are entirely dependent on overseas imports.

The announcement mainly focuses on intensively supporting technology development to convert labor-intensive processes into automated processes in order to encourage the return of overseas expansion companies.

This is one of the various support measures the government has introduced to make South Korea a "global factory of advanced industries," following the government's announcement last July of the Materials, Parts, and Equipment (SoBuJang) 2.0 strategy and the Smart Manufacturing Innovation 2.0 strategy, along with support for smart factories and robots.

The three projects to be supported this year were selected comprehensively considering market ripple effects, job creation, automation potential, and urgency by the privately-led "Reshoring Process Innovation Task Force (TF)" launched last month.

The Ministry of SMEs and Startups expects a high possibility of application by returning companies upon successful technology development, as a consensus was formed through the reshoring process innovation TF, which is led by private sectors such as associations and specialized research institutes, on the need to establish domestic production bases for the three projects selected this year.

Support has been significantly expanded to enable automation of complex, manual labor-intensive processes through process innovation and the introduction of robots, among other convergent process innovations.

Additionally, to ensure that the outcomes of technology development can be rapidly disseminated to multiple companies, suppliers producing automation equipment have been included as eligible recipients. Companies selected for the technology development projects can receive up to 1 billion KRW (500 million KRW per year) in R&D funding over two years.

The Ministry plans to discover more than 30 "return items" by early next year to steadily increase the success rate of reshoring for overseas expansion companies, supporting technology development for 10 projects annually, ensuring this support is not a one-time effort.

Smart reshoring will also be activated by providing follow-up support such as smart factories and manufacturing robots for returning companies.

Kim Il-ho, Head of the Smart Manufacturing Innovation Planning Group at the Ministry of SMEs and Startups, said, "In February, due to the impact of COVID-19, the supply of Chinese wiring harness parts was cut off, causing domestic automobile production to halt. This technology development support signifies the government's strong will to prevent a second wiring harness crisis and will serve as a catalyst to reduce the burden on companies returning from overseas expansions seeking cheaper labor."

Companies wishing to participate in the project can apply online through the Comprehensive Management System for SME Technology Development Projects from the 25th until next month 26th.

This content was produced with the assistance of AI translation services.