South Korea's Ministry of SMEs and Startups is accelerating efforts to build a growth ladder for small and medium enterprises (SMEs) while expanding support for local businesses and small merchants. The ministry aims to establish a growth framework that spans from startup to global expansion and re-challenge, while enhancing the competitiveness of traditional markets and overhauling SME support programs and regulations.
During a public work report held at the Blue House on August 4, the ministry announced its achievements from the first half of the year and outlined its plans for the second half. The policy goals for the second half are to create a "growth ladder for SMEs and ventures and spread the warmth of growth to ensure that everyone thrives in an irreplaceable South Korea." The ministry will focus on three main policy objectives: systematizing the growth pathways for SMEs, disseminating growth benefits across regions and social classes, and untangling the complexities of SME policies.
The ministry reported significant achievements in the first half of the year, including in areas such as startups, venture investment, exports, and support for small businesses. The newly launched "Everyone's Startup" project attracted 62,944 applicants, resulting in a competition ratio of 12.6 to 1. In the first quarter, the total amount of venture funds raised reached 44 trillion won, the highest ever, while venture investments amounted to 33 trillion won, marking the second-highest level on record. Exports by SMEs reached a record high of $64 billion, and the R&D budget for SMEs was set at a historic 22 trillion won. Additionally, the ministry implemented measures to streamline support programs, operate a reporting system for technology theft, and enhance crisis management systems for small businesses.
In the second half, the ministry plans to complete the growth ladder for SMEs and ventures, continuing the "Everyone's Startup" project and launching a second round of support for applicants after strengthening personal data protection measures. A nationwide audition is also scheduled for the end of the year. The ministry will select six additional startup cities and expand the local startup ecosystem through the establishment of regional growth funds and startup spaces.
In collaboration with relevant ministries, the ministry aims to create ecosystems for new growth sectors such as new security, pharmaceutical and biotech, climate tech, consumer goods, and manufacturing AI, with plans to support up to 40 billion won per company for a maximum of five years.
To invigorate the venture ecosystem, the ministry will establish a linkage system between the fund of funds and the National Growth Fund, and improve regulations to allow venture companies to maintain special provisions under the Venture Business Act even after they grow into mid-sized enterprises. The plan includes nurturing 3,000 national representative leap companies, focusing on promising regional enterprises.
The ministry will also strengthen the foundation for re-challenges, assisting diligent entrepreneurs in smoothly winding down their businesses while providing support for 250,000 SMEs facing crisis alerts and financial difficulties, as well as facilitating transitions to new industries.
Policies aimed at spreading the benefits of corporate growth across regions and social classes will also be implemented. The ministry plans to enhance delivery capabilities in traditional markets, promote AI-based autonomous management restaurants, and brand local commercial districts. Additionally, a basic social security system for small business owners will be developed in collaboration with relevant ministries. Support for childcare, employment, and industrial accident insurance will be expanded, and policy funding will be restructured to focus on small businesses with low to moderate credit and high growth potential.
Coexistence policies will expand from a manufacturing focus to include platforms, finance, and defense sectors. The ministry will support the establishment of related systems to facilitate employee buyouts and mergers and acquisitions for business succession, ensuring corporate sustainability. Furthermore, the ministry will streamline SME support programs across all departments, reducing similar and underperforming initiatives while redesigning them based on growth potential and regional balanced development.
Acting Minister of SMEs and Startups No Yong-seok stated, "The past six months have been a period where we mobilized all our policy capabilities to ensure that SMEs and venture companies can recover and innovate. In the second half, we will do our utmost to realize an irreplaceable South Korea where everyone grows through the growth ladder and the spread of growth benefits."
* This article has been translated by AI.
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