Lee Nak-yeon "Expand the Small and Medium Venture Business Mother Fund to 10 Trillion Won"

'Growth Strategy for the Middle Class 70%' Second Phase: Announcement of 'Venture and Small Business Development Strategy' Plan

[Asia Economy Reporter Oh Ju-yeon] Lee Nak-yeon, the former leader and presidential candidate of the Democratic Party of Korea, announced on the 19th a small and medium venture business pledge that includes expanding the Korea Fund of Funds to 10 trillion won and the prompt introduction of a multiple voting rights system for unlisted venture companies.

[Image source=Yonhap News]

On that day, at a press conference held at the National Assembly Communication Hall, Lee said, "Small and medium enterprises, which are the foundation of our economy and account for the largest share of employment, must secure independent survivability and become a new growth engine," and presented the second part of the 'Growth Strategy for 70% Middle Class,' the 'Venture and SME Development Strategy.'

Lee identified four major challenges to be addressed to secure the self-sustainability of small and medium venture enterprises: ▲ cultivating R&D capabilities ▲ securing excellent human resources ▲ strengthening capital procurement capabilities ▲ establishing a fair co-growth relationship with large corporations.

To successfully tackle these challenges, he pledged to build an innovative startup ecosystem and unify the complex startup and SME support measures into a streamlined support system. He explained that the SME support system would be reorganized to be demand (enterprise)-centered.

To this end, Lee promised to drastically increase support for promising venture companies by expanding the Korea Fund of Funds, which serves as seed money, to 10 trillion won as part of strengthening startup support systems.

His campaign explained that since its inception in 2005, the Korea Fund of Funds has accumulated about 7 trillion won in capital as of the first half of this year, with 7,804 companies invested in by the funds, and total investment amounting to 23 trillion won.

Additionally, he emphasized supporting the prompt launch of the CVC (Corporate Venture Capital) system, doubling the capital of the Technology Credit Guarantee Fund, currently at around 2 trillion won, to significantly increase loan guarantees and financial support for technology companies. He also pledged to quickly introduce a multiple voting rights system for unlisted venture companies to allow venture entrepreneurs to focus solely on management without concerns about hostile takeovers.

Lee expects that the activation of startups will serve as an opportunity to shift the perception of jobs from 'employment to entrepreneurship.'

In particular, Lee promised to strengthen the role of the Fair Trade Commission to establish a co-growth relationship between large corporations and SMEs and to enhance efforts to prevent technology theft by large corporations from SMEs.

He also announced plans to renovate aging industrial complexes, where many SMEs are located, into green smart green industrial complexes to improve productivity and support ESG transitions, and to prepare preferential policies for SMEs and mid-sized companies certified with ESG in government procurement.

Lee stated, "Strengthening the competitiveness of SMEs to make them a new growth engine is a timely task for our society and economy," and emphasized, "To nurture SMEs, the real protagonists of the 70% middle-class policy, we will boldly prepare all policy measures like a combined bombardment of 'precision, preemptive, and all-around' efforts."

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