The Korean government is concentrating its resources on the growth of gazelle-type companies in the framework of its three-year plan for economic innovation. A pilot project for policy financing support is scheduled to be launched this year, and over one trillion won (US$977.9 million) will be invested for three years down the road for the promotion of small, viable firms.
The Small & Medium Business Administration (SMBA) came up with assistance measures for gazelle companies on June 16 and announced that 90 billion won (US$88 million) of policy funds would be invested in these companies in the pilot Gazelle-type Company Promotion Project. Earlier than that, the government set up a series of new plans for small firms with much room for employment, so that they can grow into a mid-size company and contribute to job creation.
During the course of the project, the SMBA will provide a total of 1.1 trillion won (US$1.07 billion) for 500 firms between 2015 and 2017 for the assistance of R&D, overseas marketing, etc. The amount constitutes the largest part in the government’s budget for venture and start-up promotion in the three-year plan.
According to the SMBA, a gazelle company is defined as one that recorded an at least 20 percent growth in the number of permanent employees or annual sales during the past three years, with a lower limit of 15 percent applied to those located out of the metropolitan area. The 90 billion won (US$88 million) will be provided for these companies, and some additional benefits are available for those that hire more young workers below 29 years old.
“The final action plans will come out late this year after the examination of the pilot program,” said the SMBA, adding, “Then, policy funds are likely to be available even for those companies younger than seven years and those with a credit rating of BB or higher.”
The application for the policy support funds can be filed from June 17. The maximum limit for each company is 7 billion won (US$6.8 million).