[New Wave] Why Do Heads of State Value Intellectual Property?

As of 2020, the value of 'intangible assets' within the U.S. S&P 500 index exceeds $21 trillion, accounting for 90% of total assets, reaching an all-time high. The era of intangible assets has arrived due to the great transition to a digital economy. The economic value of BTS, who topped the Billboard charts, amounts to 1.7 trillion KRW. Nobel laureates in economics Robert Solow (1924?), Douglass North (1924?2015), and Paul Romer (1955?) all referred to 'technological innovation' and 'intellectual property (IP)' as institutions that drive economic growth. For this reason, heads of state in countries such as the U.S., China, and Japan have frequently emphasized the importance of intellectual property. Recently, the core of the U.S.-China trade dispute has been about seizing technological supremacy, which began with the U.S. Trade Representative's (USTR) investigation into China's intellectual property rights infringement.

In a situation where economic recession continues and voices expressing concern for South Korea's future are growing louder, it is necessary to consider whether our nation's leaders truly value intellectual property. First, South Korea's IP policy is based on 15 central government ministries including the Ministry of Culture, Sports and Tourism, the Ministry of Trade, Industry and Energy, and the Korean Intellectual Property Office, as well as 17 metropolitan local governments, and pursues cross-ministerial policies according to the basic plan of the National Intellectual Property Committee.

However, thinking about the future makes one feel very heavy-hearted. The core organization of the committee, the Intellectual Property Strategic Planning Group, was initially under the Prime Minister's Office but is now a separate organization under the Ministry of Science and ICT. It lacks execution and budget review functions, and the civil servants handling the committee's affairs are temporarily dispatched from various ministries, resulting in a lack of expertise and accountability. Consequently, the committee's original comprehensive coordination function, which will reach its 10th year next year, is not functioning properly.

South Korea ranks first in the world in research and development (R&D) investment relative to GDP (24 trillion KRW) and fourth in patent applications worldwide (220,000 cases), but 40% of patents from government-funded research institutes receive a C grade or lower, which does not qualify for guarantee support. Furthermore, policies on patents, copyrights, technology protection, and IP finance are pursued sporadically by multiple ministries, revealing overlaps and inefficiencies due to a lack of interconnectivity. Additionally, new technology IP policies such as artificial intelligence (AI), big data, augmented reality (AR), and virtual reality (VR) tend to be stalled or lose consistency due to conflicts rather than cooperation among ministries.

Now is the time for fundamental change in IP governance. Intellectual property is protected in various forms including patents, utility models, trademarks, designs, copyrights, trade secrets, software, genetic resources, content, data, industrial technology, and publicity rights. IP policy must be organically connected across multiple areas such as science and technology, human resources, trade, finance, security, and dispute resolution on the basic foundation of 'creation-protection-utilization' to generate synergy.

Therefore, to organically promote IP policies scattered across ministries and blocked by departmental barriers, it is necessary to consider establishing a ministerial-level 'Intellectual Property Agency' or a 'committee with executive power as a central administrative agency.' For example, many countries including the European Union (EU), the United Kingdom, Canada, Russia, and Australia have integrated intellectual property administrative systems. The United States has a 'Intellectual Property Enforcement Coordinator' directly under the President.

It is self-evident that South Korea, a country barren in natural resources, must prioritize intellectual property for future economic growth, and the starting point is to integrate and reorganize the administrative system to match the changes of the times.

Seungwoo Son, Professor, Department of Industrial Security, Chung-Ang University

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