Five Key Economic and Industrial Policy Issues for the Lee Administration... Samjong KPMG Presents Industry-Specific Strategies

The five key issues in the economic and industrial policies of the Lee Jaemyung administration have been identified as follows: expansive fiscal policy, future strategic industries 'ABCDE', corporate governance and value-up, carbon neutrality, and restructuring of trade and supply chains.

On August 14, Samjong KPMG announced the publication of its report titled "Lee Jaemyungnomics Roadmap: Industry Impact Analysis Based on the Five-Year National Administration Plan." The report presents "JMnomics" as the core keyword of the Lee Jaemyung administration's economic and industrial policies, and provides an in-depth analysis of the five major tasks expected to drive future changes in the economic paradigm. JMnomics is an acronym derived from the initial letters of Jobs, Market, New-tech, Outlay, Mutual, Investment, Climate, and Supply Chain.

With regard to expansive fiscal policy, the Lee Jaemyung administration aims to pursue a growth strategy led by fiscal investment, planning a total of 210 trillion won in fiscal spending to foster advanced industries and realize a "basic society." The government is considering temporarily raising the tax credit for facility investment and expanding large-scale investments in advanced industries. At the same time, it is reviewing measures to secure funding, such as increasing the top corporate tax rate and adjusting the criteria for capital gains taxation. The report predicts, "These changes will expand public expenditure and infrastructure investment opportunities, while also increasing the need for companies to review their cost structures and optimize their capital management strategies."

The future strategic industries 'ABCDE' refer to AI (Artificial Intelligence), Bio, Contents (Cultural Contents), Defense (Defense and Aerospace), and Energy. The government plans to build a growth infrastructure centered on advanced industries, such as the "AI-Energy Expressway," with a target set for the 2030s. The main policy directions include making Korea one of the top three AI powerhouses, securing global competitiveness in the bio sector, expanding support for the content industry, strengthening R&D in advanced defense industries, and increasing the share of renewable energy. The report advises, "Companies within these value chains should closely monitor the government's technology development support and investment policies."

In the area of corporate governance and value-up, there is a high possibility of promoting measures such as strengthening board independence through amendments to the Commercial Act, improving the audit committee system, mandating the cancellation of treasury shares, and expanding disclosure systems to enhance corporate value. Accordingly, the report emphasizes that companies should establish concrete value-up execution plans, strengthen internal controls and shareholder protection, and implement shareholder return policies.

To achieve the goal of carbon neutrality, the government is accelerating the transition to renewable energy and is working to establish an industrial base capable of meeting the rapidly increasing electricity demand with renewables. The activation of related industries is expected across all stages of the value chain, from renewable energy generation to utilization.

In trade and supply chain, the government is responding to geopolitical risks and climate change by promoting supply chain localization, reshoring of strategic industries, diversification of trade structures, and strengthening international cooperation. Through these efforts, the strategy is to enhance the self-sufficiency of supply chains and industries, and to reinforce an export base and economic security that can withstand external shocks.

The report also presents specific impacts and response strategies for 14 major industries, including AI, semiconductors, automobiles, defense, energy, bio-healthcare, logistics, shipbuilding, media and entertainment, tourism, digital assets, construction, food service, and finance.

In the AI industry, the government is driving a 25 trillion won national investment, expanding GPU infrastructure, and fostering a "sovereign AI" ecosystem. In the semiconductor industry, the introduction of production tax credits, the creation of clusters for materials, components, and equipment, and the development of the "K-Fabless Valley" are underway. The report notes, "Companies need to develop strategies to leverage policy support in AI infrastructure areas such as AI semiconductors and data centers for proactive market acquisition and enhanced global competitiveness."

The automobile industry aims to achieve a 50% electric vehicle penetration rate and commercialize autonomous driving by 2030. The defense industry is focusing on expanding export items with AI-based weapon systems and securing competitiveness in MRO (Maintenance, Repair, and Overhaul). The energy sector is prioritizing offshore wind power and distributed energy systems, while the bio-healthcare sector is accelerating AI-driven drug development and the establishment of a public healthcare infrastructure ecosystem.

In the logistics industry, the expansion of tri-port (port, airport, and railway) integrated logistics systems and AI-based smart logistics is expected, with a particular focus on strengthening industrial clusters and collaboration with global shipping and airline companies centered around major logistics hubs such as Busan. The shipbuilding industry is set to strengthen competitiveness in eco-friendly and high value-added vessels. The media and entertainment sector is expanding global outreach and content production support to achieve a 300 trillion won K-culture market.

The report states that the tourism industry needs to develop regionally linked products in line with national balanced growth and reduced working hours, and should actively consider operational efficiency measures such as the introduction of AI automation technologies. In addition, for the digital asset industry, the establishment of a two-tier regulatory framework for won-based stablecoins and digital assets, as well as the development of new business models by companies, will be key.

The construction industry is targeting domestic demand stimulation centered on SOC, housing, and smart technologies, as well as expanding overseas orders. The financial sector is required to establish a bad bank, increase corporate lending to offset the decline in personal loans, and secure new revenue sources. It is also essential to prepare for rising demand in the stock market and venture finance, and to strengthen risk management.

The Samjong KPMG Economic Research Institute stated, "With the confirmation of the Lee Jaemyung administration's 123 key national tasks, policy uncertainty has eased. Companies should closely monitor policy directions and implementation speed, and proactively establish tailored response strategies for each industry." The institute added, "It is necessary to develop agile and flexible response strategies to both the government's policy priorities and external variables, such as the policy direction of the Trump administration in the United States, and to turn these into opportunities for corporate growth."

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