Government to Enhance Investment Support for Critical Mineral Supply Chain

The South Korean government is set to expand investment support to secure a stable supply chain for critical minerals, essential raw materials for advanced industries such as semiconductors, electric vehicles, and artificial intelligence (AI). In particular, the government plans to explore the use of the National Growth Fund, considering the long-term, large-scale funding needs of critical mineral projects.

On July 23, the Ministry of Trade, Industry and Energy and the Financial Services Commission held a meeting at the Korea Trade Insurance Corporation in Seoul to discuss ways to stimulate investment and financial support in the critical minerals sector.

This meeting was organized as a follow-up to the comprehensive measures for the rare earth supply chain announced during the third Resource Security Council held in February. Key attendees included Yang Gi-wook, head of the Ministry's Resource Security Division, and Son Young-chae, head of the National Growth Fund Promotion Team at the Financial Services Commission, along with representatives from companies involved in critical minerals.

The government aims to strengthen support across the entire critical mineral supply chain, from securing overseas resources to refining, processing, and recycling.

The Ministry of Trade, Industry and Energy introduced plans for special loans and investment support for resource development projects, as well as expanding stockpiles of essential raw materials. It also outlined research and development (R&D) support for developing permanent magnet technology in the rare earth processing sector.

The Financial Services Commission noted that critical mineral projects are among the 12 key industries supported by the National Growth Fund, emphasizing active financial support for projects that significantly stabilize the supply chain. The National Growth Fund is a policy fund that supports advanced strategic industries and related infrastructure, including AI, semiconductors, batteries, future vehicles, defense, and robotics.

During the discussions, companies expressed concerns about intensified global competition in overseas resource development, difficulties in securing critical equipment and technology, and raw material supply issues for recycling projects. They stressed the need for public sector financial support and risk-sharing due to the high business risks associated with large-scale investments.

Additionally, they presented investment plans for major projects, including overseas resource development, rare earth permanent magnet production, and critical mineral recycling, while requesting continued government support.

Yang Gi-wook stated, "The critical mineral supply chain is a fundamental basis that underpins the competitiveness of advanced industries such as semiconductors, electric vehicles, and AI, and is directly linked to national economic security. The Ministry and the Financial Services Commission will work together to expand business and financial support across the entire cycle, from overseas resource development to refining, processing, and recycling."