Expansion of Policy Finance Support to Foster the K-Smart Logistics Industry

[Asia Economy Reporter Yoo In-ho] Going forward, policy financial support such as preferential loans, logistics fund creation, and investment attraction will be significantly expanded for logistics infrastructure and companies equipped with advanced facilities and innovation.

On the 17th, Kim Hyun-mi, Minister of Land, Infrastructure and Transport, and Lee Dong-gul, Chairman of the Korea Development Bank, signed a "Policy Financial Support Agreement for the Promotion of K-Smart Logistics" at the China Land Development Exhibition Hall in Seoul.

Both organizations agreed on the recognition that active private investment is necessary for the successful implementation of the smart logistics system policy, and decided to promote various policy financial support projects to serve as a catalyst for continuous activation of private investment.

First, for smart logistics centers certified by the government, the government will provide interest rate subsidies through fiscal support to offer preferential loans with interest rates up to 2 percentage points lower than market rates, operating on an annual scale of 500 billion KRW starting from the first half of next year.

To enable the logistics industry to develop based on domestic capital, the Korea Development Bank will establish a fund investing 300 billion KRW in logistics infrastructure and 50 billion KRW in logistics companies based on its equity participation.

The logistics infrastructure fund will be at least 300 billion KRW in size, with up to 100 billion KRW of equity participation from the Korea Development Bank. The logistics innovation company fund will be at least 50 billion KRW in size, with up to 15 billion KRW of equity participation from the Korea Development Bank.

In particular, small and medium-sized enterprises and mid-sized companies moving into logistics facilities created through investments by these funds will be offered rental discounts.

In addition, regular investment briefing sessions will be held to discover innovative companies such as logistics ventures and startups and support investment attraction.

The Ministry of Land, Infrastructure and Transport has initiated this smart logistics support because the logistics industry worldwide is growing into a smart new industry due to the Fourth Industrial Revolution and the COVID-19 pandemic.

Accordingly, to strengthen the competitiveness of the domestic logistics industry, which is lagging behind advanced countries, the government announced the Korean New Deal comprehensive plan last July and is actively promoting the "Smart Logistics System Construction" policy as part of it.

By 2025, a total project cost of 3.4 trillion KRW will be invested in six projects including the expansion of smart logistics centers, logistics innovation R&D, and the creation of digital logistics pilot cities, aiming to create 55,000 jobs.

Minister Kim said, "This agreement is expected to inject new vitality into our logistics industry and serve as an opportunity to leap forward as K-Smart Logistics with global competitiveness."

Chairman Lee also stated, "The Korea Development Bank will actively respond to government policies such as the Korean New Deal and work together to foster future new industries including the logistics industry."

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