The government plans to invest up to 20 trillion won over four years to support local-led growth and provide financial incentives. Additionally, it will fully subsidize tuition for 30 national universities in local areas.
On September 1, the Ministry of Planning and Budget presented the 2027 budget proposal at a Cabinet meeting.
To bolster local-led growth, the number of projects applying the local preference principle will increase significantly from seven to 61. The government will provide financial incentives of up to 20 trillion won over four years to ensure the stable establishment of integrated special cities. For the upcoming year, the financial incentive amount is set at 5 trillion won, which includes 3.5 trillion won from the Future Response Fund and 1.5 trillion won from the semiconductor special account.
Minister of Planning and Budget Park Hong-keun stated, "We will significantly expand projects applying the local preference principle and establish a super-regional special account to support the 5 regions and 3 special projects, while also increasing the comprehensive grants that local governments can autonomously allocate. We will ensure that administrative integration incentives of up to 5 trillion won annually, totaling 20 trillion won over four years, are provided without disruption."
To support the 5 regions and 3 special areas, a super-regional account worth 2.8 trillion won will be established, and the comprehensive grants that local governments can autonomously allocate will be increased. As a result, the total amount of comprehensive grants will rise from 10.6 trillion won to 11.9 trillion won, with the number of projects increasing from 121 to 150.
A new special grant for growth engine industries will be introduced to support large-scale investments by anchor companies in local areas, covering up to 50% of facility investment costs. The grant will amount to 700 billion won, with large companies eligible for 300 billion won and medium-sized enterprises for at least 100 billion won.
The grant rate will be determined based on the facility investment amount, accompanying investments from upstream and downstream companies, job creation, and local economic impact. The government plans to match 2 to 5 times the investment grants provided by local governments with national funds.
Tuition will be fully subsidized for 30 national universities in local areas, excluding medical, dental, pharmacy, and veterinary schools. Additionally, 700 billion won will be allocated for the development of local national universities, and 500 billion won will be invested in fostering regional national university hospitals. The scholarship budget is set at 200 billion won.
Furthermore, the regional talent scholarship will be expanded from 800 billion won to 1.15 trillion won, with 10,000 new students selected for admission to regionally specialized private universities.
To improve local educational infrastructure, a new Future Talent Growth Fund of 700 billion won will be established. This will support 21 local national universities, excluding teacher training colleges, in autonomously investing in attracting distinguished scholars and advanced research. An additional 600 billion won will be allocated to build educational and research infrastructure for science and engineering at private universities in connection with regional strategic industries, including mega-projects.
Minister Park stated, "We will establish a special grant for growth engine industries and expand support for essential medical services in local areas, while fully subsidizing tuition for national universities in local regions."
* This article has been translated by AI.
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