Ministry of SMEs Budget Proposal, 28% Decrease to 13.6 Trillion Won: "Private Sector Focus, Maximizing Performance"

[Asia Economy Reporter Kim Bo-kyung] The Ministry of SMEs and Startups has prepared next year's budget at 13.6 trillion KRW, a 28% decrease from this year, and will submit it to the National Assembly on the 2nd of next month.

Minister Lee Young of the Ministry of SMEs and Startups explained on the 31st, "We have reduced the scattergun-type support budget that simply expands support volume and increased the budget for projects led or linked by the private sector in line with President Yoon Suk-yeol's private-sector-centered dynamic economy policy to maximize outcomes."

He added, "Next year's budget will focus on the global expansion of ventures and startups, scale-up and innovative growth of SMEs, while emphasizing the nurturing of growing entrepreneurial small business owners and the creation of warm local commercial districts."

The budget for next year is largely composed of ▲venture and startup development (1.945 trillion KRW) ▲SME scale-up and innovative growth (7.441 trillion KRW) ▲recovery and leap of small business owners and self-employed (4.1759 trillion KRW).

The government’s representative public-private partnership startup support program, TIPS, will be reorganized to be more business- and market-friendly, and its scale will be expanded to 378.2 billion KRW compared to 293.5 billion KRW last year. Starting next year, a new 'Deep Tech Track' will be established to support companies in future-leading fields such as bio, artificial intelligence, and aerospace, with extended support periods and increased scale.

Through collaboration with global giants with market dominance such as Google Play and NVIDIA, the government will support the growth and overseas expansion of domestic startups (40.5 billion KRW).

Additionally, universities with excellent startup support capabilities will be designated as 'Startup-Centered Universities' (67.4 billion KRW) to activate university-originated startups.

The government’s mother fund, which has a reduced scale compared to last year (313.5 billion KRW), will focus on under-invested areas such as early startups, youth and women, regions, and policy-targeted areas like super-gap sectors.

A new Super-Gap Fund (55 billion KRW investment) will be established to support the scale-up of ventures and startups in national advanced strategic industries such as system semiconductors. The government will also invest in a global fund (23.5 billion KRW) operated by overseas VCs to promote global venture capital investment in domestic ventures and startups.

In the second half of this year, the government plans to announce a plan for creating a global innovation special zone (tentative name) and nurture it as a forward base for global expansion by linking regulatory free zones with high global growth potential and nearby innovation hubs.

Lee Young, Minister of SMEs and Startups, is delivering a greeting at a press conference held on the 20th at the Korea Federation of SMEs in Yeouido, Seoul. Photo by Kang Jin-hyung aymsdream@

Furthermore, the government will prioritize SMEs in new industries and innovative growth sectors and expand funding for new facility investments to focus on SME scale-up and productivity innovation.

To resolve on-site difficulties caused by prolonged logistics issues and boost export vitality, the budget for SME export support (245.3 billion KRW) has been significantly increased by 12.6%, including a substantial expansion of logistics support.

Starting next year, the government plans to advance the level of smart factory construction through future-oriented smart factory establishment and strengthening the technological capabilities of supply companies.

Through customized support according to the level of technology protection, the government will nurture 300 leading technology protection companies over five years and alleviate corporate burdens in case of technology infringement by advancing technology protection policy insurance and supporting damage assessment.

Support for the 'comprehensive package for management improvement, closure, and re-challenge' for small business owners' recovery will be strengthened, with significant expansion of support for store demolition costs, psychological healing, consulting, and legal advice.

To ease interest burdens on small business owners, a policy fund of 3 trillion KRW will be prepared, and entrepreneurial small business owners will be nurtured to promote structural transformation.

Smart stores and smart workshops will be distributed up to 70,000 units by 2027, and 'e-commerce small business owners' will be trained at 100,000 people annually for five years (94.4 billion KRW).

Local value creators among small business owners will be supported to grow into 'local brands' representing their regions, and 'local commercial district branding' will be promoted to infuse culture and stories into neighborhood commercial districts. In this regard, 30.4 billion KRW has been allocated for the Renaissance project to revitalize commercial districts.

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