The South Korean government will launch a 1 trillion won ($829.8 million) fund devoted to promote digital and green enterprises as a part of the five-year New Deal spending plan of $133 billion aimed at giving a new growth momentum in the wake of virus crisis.
[Graphics by Song Ji-yoon]
The Ministry of SMEs and Startups, Ministry of Health and Welfare, and Ministry of Environment on Thursday jointly announced plans to create and operate so-called Smart Korea Fund to support Korean New Deal package unveiled by President Moon on Tuesday. The fund is the package to accelerate digital, green and innovation developments.
The fund at an initial capital of 1 trillion won will be expanded to 6 trillion won by 2025.
About half of the initial fund will come from the government - 400 billion won from the startups ministry, 18 billion won from welfare ministry, and 20 billion won from environment ministry – and the remainder pooled from the private sector.
From the private sector, so-called mentor companies will be invited to take part in the fund to help spur growth of rookie companies. They will invest jointly with the government and select fund manager with an aim to expand the fund size to 6 trillion won by 2025.
The fund will invest in non-face-to-face and bio industries and Green New Deal projects. The fund will support companies seeking business efficiency by adopting contact-free product and service delivery by utilizing information and communications technology, artificial intelligence, and big data. In the bio sector, the fund will invest in bio healthcare companies in diagnosis, vaccine, treatment, and medical equipment sectors while in Green New Deal in green venture firms engaged in alternative energy and upcycling business.
A total 500 billion won will go into contact-free industry, 400 billion won in bio, and 100 billion won in Green New Deal projects.
Mentor companies and financial entities wishing to take part in the fund will sign a memorandum of understanding upon Smart Korea Fund launch on July 20 before notification to select fund manager early next month.
The startups ministry said that the government will put out efforts to complete fund creating procedure by the end of this year with an aim to create 25,000 jobs once investments are made.
By Lee Eun-joo
[ⓒ Pulse by Maeil Business News Korea & mk.co.kr, All rights reserved]