South Korean government to enhance incentives for cutting-edge industries, stimulating investment growth

South Korea’s Ministry of Trade, Industry, and Energy unveils proactive measures to facilitate timely investments by manufacturing firms amidst market uncertainties, aiming to address challenges and expand incentives for businesses.

South Korea’s Ministry of Trade, Industry, and Energy unveiled proactive measures on Thursday aimed at facilitating the timely implementation of planned investments by manufacturing firms amidst mounting challenges in the business landscape.

The announcement comes against the backdrop of increasing uncertainties in the market, including prolonged monetary tightening, which could potentially hamper business activities, as outlined by the Ministry.

Citing data from the ministry, South Korea’s leading manufacturing sectors, encompassing semiconductors, automobiles, displays, and batteries among others, achieved 96 per cent of their investment commitments totalling 100 trillion won ($73.9 billion) in 2023.

In the initial quarter of this year, local businesses have already executed 20 per cent of their investment plans, amounting to 110 trillion won, according to ministry reports.

To address the persisting challenges faced by South Korean enterprises, the government intends to bolster incentives for businesses undertaking investments while actively tackling their hurdles.

First Vice Industry Minister Kang Kyung-sung emphasized the arduous business environment during a meeting with local firms, asserting that “The government plans to create an environment that enables companies to invest on time by addressing their challenges and preparing investment incentives through the extension of tax cut deadlines.”

The proactive stance of the Ministry underscores South Korea’s commitment to sustaining economic resilience and bolstering the competitiveness of its manufacturing sector amidst prevailing uncertainties.

As the global economic landscape continues to evolve, South Korea remains steadfast in its efforts to support domestic industries and navigate challenges to ensure sustained growth and prosperity.