Driving R&D Investment Innovation
The government is restructuring industrial and energy technology development projects to focus on high-risk, next-generation, and large-scale tasks. There will be a significant reduction in the financial burden on companies. The plan is to transition to a demand-driven process where businesses and researchers exercise authority over project planning and operations.
On Jan. 18, the Ministry of Trade, Industry, and Energy (MOTIE) held an “R&D Innovation Roundtable” at the Samsung Electronics Seoul R&D Campus, chaired by Minister Ahn Duk-geun. The ministry announced “Industrial and Energy R&D Investment Strategies and Institutional Innovation Measures.” Through meetings with over 500 researchers in about 20 sessions, the ministry collected on-site feedback and came up with four major innovative strategies.
The latest investment approach and plans for institutional innovation aim to shift towards a process driven by demand, empowering companies and researchers to wield control over project planning and operations.
The plan is to discontinue R&D support in the form of subsidies and instead concentrate on supporting globally competitive and challenging R&D initiatives. To achieve this, the government is conducting a feasibility study for securing cutting-edge technologies, specifically focusing on the top 10 game-changer technologies, such as Alchemist Season 2, with a budget of 1 trillion won (US$747.66 million). Furthermore, it commits to allocating over 10 percent of the annual new budget, which amounts to more than 120 billion won, to address challenges aimed at resolving industrial issues.
The proportion of support for high-risk, high-reward projects, including those that allow for failure, will be expanded from the current 1 percent to 10 percent in the next five years. A total investment of 2 trillion won, including 1.3 trillion won from the government and 700 billion won from the private sector, will be allocated to the 40 groundbreaking projects in 11 key sectors.
Despite discontinuing support in the form of subsidies, the MOTIE is establishing a corporate venture capital (CVC) fund of 2.4 trillion won this year to foster innovation enterprises. A new program, the National Advanced Strategic Industry Technology Innovation Loan, is set to be introduced, offering loans with a low interest rate of 1.84 percent, available for up to 39 billion won until 2027 to support technological innovation in strategic industries.
Cooperation centers will be established in six globally outstanding research institutions, and strategic collaborative research will be pursued for 180 essential core technologies that require international cooperation. The focus is particularly on transitioning the R&D process to a demand-driven approach.
Allocating a budget of 2.294 trillion won, an 11 percent increase from the previous year, the government plans to enhance workforce development. Additionally, it will designate eight more graduate schools specializing in advanced industries such as semiconductors, batteries, displays, and biotechnology. The government also supports overseas research assignments during international collaborative research initiatives.