Nearly 33% of the approved allocations from the National Growth Fund, launched last year, have been directed towards artificial intelligence (AI) and semiconductors. In contrast, investments in future cars, which were expected to play a pivotal role in creating jobs in advanced manufacturing, accounted for less than 1%, significantly below the government’s initial distribution guidelines.
According to data submitted by the Korea Development Bank to Han Min-soo, a member of the Democratic Party, as of the end of September, the National Growth Fund had approved 35 projects with a total allocation of 18.328 trillion won. This includes 8.5685 trillion won from public funds and 9.4643 trillion won from private sources.
By sector, infrastructure received the largest share at 7.7332 trillion won (42.9%), followed by semiconductors at 4.7595 trillion won (26.4%), displays at 1.5 trillion won (8.3%), AI at 1.1381 trillion won (6.3%), biovaccines at 905 billion won (5.0%), secondary batteries at 870 billion won (4.8%), defense at 500 billion won (2.8%), and robotics at 382 billion won (2.1%).
The infrastructure projects include the Shinan Uwi offshore wind power project at 3.4 trillion won, the Smilegate AI data center at 2.7962 trillion won, and the Yawol offshore wind power project at 757 billion won. Of the total approved infrastructure funding, 1.568 trillion won came from public funds, while private investments accounted for 6.1652 trillion won. The initial approval figures show a relatively high proportion of infrastructure investment compared to the 33.3% guideline set at the fund's launch.
The government’s primary focus for the National Growth Fund includes advanced strategic industries such as AI and semiconductors. The largest loan approval was for Samsung Electronics' AI semiconductor production facility, amounting to 2.5 trillion won, which represents about 28% of the total funding for that project. Among direct investments, the largest support was for the Furiosa AI project included in the 'K-NVIDIA Project,' which received a total of 800 billion won, comprising 370 billion won from public funds and 430 billion won from private sources.
In contrast, the approved funding for future cars and biovaccines was only 0.14% and 5.02% of the total, respectively. Currently, these figures are lower than the government’s initial five-year distribution guidelines, which suggested allocations of 15.4 trillion won for mobility (future cars) and 11.6 trillion won for biovaccines, representing 10.3% and 7.7% of the total 150 trillion won, respectively.
Notably, the only loan in the future car sector was for 25 billion won to establish a battery pack case manufacturing line by Hwashin. In the biovaccine sector, three approvals were granted, including a direct investment of 500 billion won for Rigachem Bioscience, 850 billion won for BTGen's biogeneric production facility expansion, and 200 billion won for Kyungbo Pharmaceutical's antibody-drug conjugate (ADC) production facility.
Market observers are keen to see whether the support for future cars and biovaccines will increase in the future. The government previously stated that it would respond flexibly to industry demands regarding the distribution guidelines for the National Growth Fund.
* This article has been translated by AI.
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