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Ministerial Meeting on Economic Affairs (Jun.3, 2024)

  • DivisionPolicy Coordination Bureau - General Policy Coordination Division
  • DateJune 3, 2024
  • Tel+82 44 215 4510

Deputy Prime Minister Choi Sang-mok convened the Ministerial Meeting on Economic Affairs on June 3 at the Government Complex-Sejong. The meeting discussed the following topics: ① Corporate Growth Ladder Establishment Plan, ② Export Condition Reviews and Additional Support Measures,  Major Reforms to the R&D Budget System, and  Improvement Measures to the Technology Fee System.



The following are key messages of DPM Choi’s remarks.

Recently, the Korean economy has been showing continued signs of recovery on the back of strong improvements in exports and manufacturing. Industrial activities in April saw a rebound mainly driven by manufacturing, and exports in May recorded double-digit growth for the second consecutive month, continuing an eight-month streak of positive growth.


The government aims to ensure that the effects of this economic recovery quickly spread to every corner of people’s lives. Furthermore, the government will initiate the build-up of a dynamic economy that encourages companies to climb the growth ladder to take a leap forward and transform national R&D into a leading model.


However, it is unfortunate that many of the economic and livelihood-related bills supporting these initiatives were scrapped with the conclusion of the 21st National Assembly a few days ago. The government would swiftly reorganize major legislative tasks to ensure prompt discussions in the 22nd National Assembly. During this process, the voices of the public and businesses would be diligently delivered to the National Assembly.



[Corporate Growth Ladder Plan]


As part of efforts to boost Korea’s growth potential, the government will push forward the “Corporate Growth Ladder Establishment Plan”, which is the first measure in the series focusing on the growth of SMEs into middle market enterprises.


First, much endeavors will be made to strengthen the growth incentives for companies graduating from the SME status and to encourage their successful transition to middle market enterprises; the graduation grace period during which SMEs can continue to receive tax benefits even after growing into the middle market enterprises will be extended from three years to five years; listed SMEs will be granted an additional two-year grace period, allowing them to receive those benefits for up to seven years in total to promote the Corporate Value-up initiative.


Second, a new program, tentatively named the “Growth Ladder Jump-Up Program”, will be established to select and support 100 promising SMEs for three years, with the goal of more than doubling the number of SMEs advancing to middle market enterprises.


Third, the government is committed to providing full support for boosting the potential capabilities of Korean SMEs; company-specific technological and financial information held by public institutions will be made available to private financial institutions to facilitate matching between promising SMEs and private investors.



[Export Condition Reviews and Additional Support Measures]


The government commits to back up Korean exporting companies, who are advancing despite the headwinds of enhanced protectionism in global trade.


First of all, in order to buttress the increased export volume, policy financing will be raised by 5 trillion won to a total of 365 trillion won and commercial banks’ export preferential programs will also be expanded by 2 trillion won (5.4 trillion to 7.4 trillion won), thus scaling up trade financing by a total of 7 trillion won.


Second, the government will provide tailored measures to enhance corporate competitiveness considering the export conditions of each industry. As part of the efforts, a 0% tariff rate will be applied on crude oil for manufacturing naphtha and liquefied petroleum gas (LPG), as well as naphtha and LPG until the end of the year.


Third, aiming to support exporting companies to reach broader markets, integrated Korean pavilions at overseas exhibitions will be scaled up to step up the global expansion of Korean businesses.



[Major Reforms to the R&D Budget System & Improvement Measures to the Technology Fee System]


Fostering advanced technology is a national task to seize leadership in the global power competition and to open up a new future for Korea. In this context, the government has declared this year as the inaugural year for the grand transition to leading-edge R&D and boldly reform the R&D fiscal investment system.


To this end, the preliminary feasibility study for R&D projects will be abolished in order to secure the golden time for research, and the sunset clause on R&D will be eliminated to provide stable support for the unique missions and long-term research of ministries. In addition, the government-imposed technology fee rate will be reduced by half of its current level with an aim to alleviate the burden on enterprises as well as encourage corporate participation in adventurous R&D.

Please refer to the attached files. 

Ministry of Economy and Finance
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