95% of Corporate Research Institutes Are 'Small-Scale with Fewer Than 5 Employees'... Government Launches Focused Support Initiative

Ministry of Science and ICT to Provide 5.59 Billion KRW in New Support This Year

Corporate-affiliated Research Institute. Stock photo. Not related to the article.

[Asia Economy Reporter Kim Bong-su] The government is launching a new support project to strengthen the capabilities of affiliated research institutes in order to encourage research and development (R&D) activities of small and medium-sized enterprises (SMEs).

The Ministry of Science and ICT announced on the 18th that it will newly promote the "Corporate-affiliated Research Institute R&D Capability Enhancement Support Project" starting this year to support the strengthening of research capabilities of corporate-affiliated research institutes.

Corporate research institutes are organizations responsible for private sector R&D activities and have grown significantly in quantity. Currently, about 44,000 are in operation, serving as the main pillar of national R&D, which accounts for about 80% of the country's total R&D expenditure. Of the national R&D budget of 93.1 trillion won (as of 2020), corporations spend 73.6 trillion won (79.1%), followed by public research institutions with 11.1 trillion won, and universities with 8.4 trillion won.

However, most research institutes of SMEs and mid-sized companies, which make up the majority by number, are small in scale and have low survival rates. As of December last year, out of a total of 44,067 research institutes, SMEs accounted for 41,887 (95.1%), and mid-sized companies had 1,437 (3.3%). As of 2020, small-scale research institutes with fewer than five researchers accounted for 61.1%, the majority. The five-year survival rate was 44.4% (2019), meaning that six out of ten institutes close within five years of establishment.

The Ministry of Science and ICT will support small-scale research institutes of SMEs with a budget of 5.59 billion won this year. They plan to develop a "Corporate Research Institute R&D Capability Diagnosis Model" that quantifies and diagnoses research capabilities, grouping corporate research institutes according to their R&D capabilities and providing customized support measures necessary for advancing to higher groups. Additionally, they will operate a "Private R&D Council" composed of leading companies to derive innovation growth tasks based on private sector demand. Especially this year, support will be expanded continuously reflecting corporate demand in the fields of carbon neutrality and smart sensors.

Kwon Seok-min, Director of Science and Technology Job Innovation at the Ministry of Science and ICT, stated, "Despite the quantitative growth in the scale of corporate R&D support and the number of corporate research institutes, dedicated development projects to strengthen research capabilities in terms of qualitative growth have been insufficient. We expect that improving the research capabilities of corporate research institutes, which are the main pillar of national R&D, will solidify the substance and infrastructure of national R&D and greatly contribute to enhancing the overall national innovation capacity."

Detailed information can be found on the websites of the Ministry of Science and ICT, the National Science and Technology Information Service (NTIS), and the Korea Industrial Technology Association.

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