128.6 Billion Won Agri-Food Fund Raised in First Half of Year... Focused Investment in Smart Agriculture and Food Tech

'Smart Agriculture Fund' Investment Targets Include Smart Farm Equipment Export Companies
Expansion to Over 200 Billion Won Within the Year

On the 24th, the Ministry of Agriculture, Food and Rural Affairs announced that it newly established an agricultural and food fund worth a total of 128.6 billion KRW in the first half of this year (87.5 billion KRW from the Agricultural and Food Mother Fund and 41.1 billion KRW from the private sector).

An official from the Ministry of Agriculture, Food and Rural Affairs stated, "Due to the recent continuation of high interest rates, financial burdens are increasing, making it difficult for early-stage startups with weak financial structures to secure business funds." He added, "Reflecting these field difficulties, starting with 128.6 billion KRW in the first half of 2023, we plan to form a fund exceeding 200 billion KRW within the year to strengthen financial support for new agricultural and food industries and early-stage companies."

Through this investment project, the Ministry will expand investments in new industry sectors such as smart agriculture, green bio, and food tech. The 'Food Tech Fund,' initially established with a scale of 10 billion KRW this year, will focus investments on startups in the field (less than 7 years since establishment) to lay the foundation for the growth of the food tech industry.

Dedicated funds investing in companies in the smart agriculture and green bio sectors will also be additionally established, each with a scale of 20 billion KRW. Notably, while previous investments mainly targeted companies producing and selling agricultural products through smart farms, the investment scope of the 'Smart Agriculture Fund' will be expanded to include companies exporting smart farm equipment.

Support for young farmers and startups newly entering the agricultural and food sector will also be expanded. The scale of the 'Young Farmers Fund,' targeting young farmers, will increase from 10 billion KRW last year to 15 billion KRW this year. The 'Direct Investment Fund,' which focuses investments on young farmers and startups with insufficient collateral but excellent business performance and farming will, will also be expanded and established at 3 billion KRW to support the stable settlement of new personnel in agriculture. Unlike existing funds involving private investors, the Direct Investment Fund is 100% funded by the Mother Fund and managed by an investment management specialized institution (Agricultural Policy Insurance and Finance Service), investing in areas where attracting private investment is difficult.

During the operator selection process, operators showed great interest in investing in non-metropolitan areas. Among the 21 operators participating in the application stage, 10 voluntarily expressed their intention to participate on the condition of investing in agricultural and food companies in non-metropolitan areas, and 4 of these operators were finally selected, with over 20 billion KRW expected to be invested in non-metropolitan regions. The Ministry of Agriculture, Food and Rural Affairs expects that this will expand investments in non-metropolitan areas and help respond to regional extinction.

Park Su-jin, Director of Agricultural Policy at the Ministry of Agriculture, Food and Rural Affairs, said, "The Agricultural and Food Mother Fund is a system that can attract private capital using government funds as seed money to enhance the effect of fiscal input." He added, "We will actively utilize this to expand investments in new agricultural and food industries such as smart agriculture, green bio, and food tech, and strengthen support so that young entrepreneurial farmers and startups can operate their businesses stably during times when securing funds is difficult."

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