[2023 Budget] Ministry of Industry's 10.7 Trillion Won Budget for Next Year... Additional 90 Billion Won Investment in Nuclear Power

Ministry of Industry's 10.7 Trillion Won Budget for Next Year... 3.7% Decrease from Previous Year
335.3 Billion Won Invested in Semiconductors... Focused Support for SoBuJang R&D
Energy Budget Down 5.8%... Nuclear Power Investment Increased by 90 Billion Won

Minister Lee Chang-yang of the Ministry of Trade, Industry and Energy is speaking at the industry meeting on responses to the U.S. Semiconductor and Electric Vehicle Support Act held on the 25th at the Korea Chamber of Commerce and Industry in Jung-gu, Seoul. Photo by Moon Honam munonam@

[Asia Economy Sejong=Reporter Lee Jun-hyung] The Ministry of Trade, Industry and Energy's budget for next year has been set at 10.7 trillion KRW. This is over 400 billion KRW less than this year's main budget of 11.16 trillion KRW. However, approximately 90 billion KRW has been additionally allocated to the nuclear power plant projects, a key policy task of the Yoon Seok-yeol administration.

The Ministry announced on the 31st that this year's budget was set at 10.7437 trillion KRW. This is a decrease of 413.4 billion KRW (3.7%) compared to this year's main budget of 11.1571 trillion KRW. The budget increased by 104.6 billion KRW from 8.0632 trillion KRW this year to 8.1678 trillion KRW next year. On the other hand, funds decreased by 518.1 billion KRW from 3.0939 trillion KRW to 2.5759 trillion KRW during the same period. This is a result of the Yoon Seok-yeol administration's 'government streamlining' policy. A ministry official explained, "In line with the government's sound fiscal policy, we have restructured expenditures on lower priority projects first," adding, "We have expanded research and development (R&D) investments in national policy tasks and future core strategic technologies."

2.3 Trillion KRW Invested in Advanced and Key Industries... 100 Billion KRW Increase in Materials, Parts, and Equipment R&D

The government has notably expanded the budget for advanced industries such as semiconductors. The Ministry plans to invest 2.2608 trillion KRW in advanced and key industries including semiconductors to secure a 'super-gap.' Specifically, the semiconductor budget will increase by 18.4 billion KRW from 316.9 billion KRW this year to 335.3 billion KRW next year. During the same period, the budget for materials, parts, and equipment (SoBuJang) will rise by 43.2 billion KRW from 1.3129 trillion KRW to 1.3561 trillion KRW. The future car budget, including electric vehicles, will also increase by 39.8 billion KRW from 412.3 billion KRW to 452.1 billion KRW.

The Ministry plans to use the semiconductor budget to create an environment for nurturing next-generation system semiconductors. Additionally, new projects next year will support industry-led on-site and R&D workforce training based on industrial demand. In the SoBuJang sector, demand-linked technology development and core material technology independence will be the focus of R&D support. Accordingly, the Ministry increased the materials and parts technology development budget by about 100 billion KRW from 841 billion KRW to 937.6 billion KRW. It will diversify import sources for items highly dependent on specific countries such as Japan and China and operate an early warning system by conducting in-depth analysis of global supply chains.

The future car budget will be used for eco-friendly vehicles, autonomous driving technology development, and related ecosystem creation. The Ministry plans to support both business transformation of auto parts companies and overcoming employment crises in response to the future car industry restructuring. However, the regional balanced development budget will decrease by 128.4 billion KRW from 1.005 trillion KRW this year to 872.1 billion KRW next year.

Current Budget Allocation Status for Advanced and Key Industries. [Photo by Ministry of Trade, Industry and Energy]

Energy Budget at 4.3 Trillion KRW... 573.8 Billion KRW Invested in Nuclear Power

The energy budget will decrease by 262.5 billion KRW (5.8%) from 4.5265 trillion KRW to 4.264 trillion KRW. This is mainly due to a significant reduction in the low-carbon transition budget from 1.8986 trillion KRW to 1.4207 trillion KRW. However, the nuclear power budget will increase from 483.9 billion KRW to 573.8 billion KRW, and the resource supply chain budget will rise from 429.9 billion KRW to 674.4 billion KRW. The energy welfare budget will also increase by 50.8 billion KRW from 416.6 billion KRW to 467.4 billion KRW.

The nuclear power budget will be used to restore the domestic nuclear power ecosystem and industrialize exports. Accordingly, the Ministry allocated 8.9 billion KRW and 7.7 billion KRW respectively for the Nuclear Ecosystem Support Project and Overseas Power Export Support Project. The Ministry plans to actively support nuclear power export activities through the Nuclear Power Export Strategy Promotion Committee and back the strengthening of nuclear power companies' capabilities and workforce training to resume construction of Shin Hanul Units 3 and 4. It will also support the establishment of radioactive waste disposal facilities and development of next-generation nuclear technologies such as Small Modular Reactors (SMRs).

Energy Budget Allocation Status. [Photo by Ministry of Trade, Industry and Energy]

The resource supply chain budget will be used to expand reserves of oil and critical minerals. The Ministry plans to increase the oil reserve project contribution from 38.2 billion KRW to 67.3 billion KRW, nearly a 30 billion KRW increase, to expand oil reserves. Additionally, to diversify resource import sources through domestic and overseas resource development investments, the special overseas resource development loan will increase by 112.3 billion KRW from 63.1 billion KRW to 175.4 billion KRW. A newly launched project next year, 'Establishment of Overseas Clean Hydrogen and Ammonia Production and Import Infrastructure,' has been allocated 4 billion KRW.

Furthermore, the Ministry plans to expand support for vulnerable groups through the energy welfare budget. First, the energy voucher support amount for heating and cooling fuel costs for 857,000 low-income households will increase from 127,000 KRW annually to 185,000 KRW, about a 60,000 KRW rise. Accordingly, the Ministry set the energy voucher budget to increase from 138.9 billion KRW this year to 182.4 billion KRW next year. The energy cashback project, piloted this year, will be promoted as a new project starting next year.

Trade and Commerce Budget Allocation Status. [Photo by Ministry of Trade, Industry and Energy]

914 Billion KRW Allocated for Trade and Commerce... Export Support Budget Reduced by 40 Billion KRW

The trade and commerce budget will decrease by 28.7 billion KRW (3.1%) from 942.3 billion KRW this year to 913.6 billion KRW next year. Specifically, the export vitality enhancement budget will decrease by 38.9 billion KRW from 554 billion KRW to 515.1 billion KRW. This reduction comes at a time when the trade balance has recorded deficits for four consecutive months for the first time in 14 years since 2008, signaling alarms on the export front, and the government's export support budget has also been cut. However, the Ministry stated it will fully support domestic companies in maintaining export growth amid external uncertainties such as supply chain restructuring by promoting overseas market development and trade risk response.

The investment attraction budget will slightly increase from 243.5 billion KRW to 250.5 billion KRW. This is to expand support for foreign investment and returning companies in response to global supply chain restructuring. The Ministry also plans to invest in trade security to prevent the overseas outflow of advanced technologies and high-level personnel in national core technologies, thereby strengthening industrial supply chains.

The trade and international cooperation budget will decrease by 0.5 billion KRW from 113.9 billion KRW to 113.4 billion KRW. Through this budget, the government will lead discussions on the Indo-Pacific Economic Framework (IPEF), which it joined last May, and actively respond to disputes at the World Trade Organization (WTO). The Official Development Assistance (ODA) budget for industrial trade cooperation development to support infrastructure building in developing countries and overseas expansion of domestic companies will increase from 39.4 billion KRW to 43.3 billion KRW.

The budget related to the 2030 Busan World Expo will increase by 4.3 billion KRW from 17 billion KRW to 21.3 billion KRW. The Busan Expo budget will be used for negotiation activities with the Bureau International des Expositions (BIE) and participation fees for the general assembly.

Meanwhile, the Ministry's '2023 Budget and Fund Operation Plan' announced on the same day will be finalized in early December after submission to the National Assembly and deliberations by standing committees and the Special Committee on Budget and Accounts.

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