South Korea's $34 Billion Fund: A Booster for National Strategic Industries

South Korea, a global leader in technology and manufacturing, is set to allocate a $34 billion fund to support its national strategic industries. This significant investment, announced by the government on March 5, 2025, aims to bolster the competitiveness of advanced industries crucial to the country's economic security. The fund will be created under the Korea Industrial Bank and will support sectors such as semiconductors, rechargeable batteries, bio, artificial intelligence (AI), robotics, and other advanced industries. It will also be used to develop infrastructure and core technologies for these industries in the long term.

The fund is part of the government's broader economic policy framework, which has historically prioritized high-tech sectors like semiconductors and electronics. This initiative aligns with the government's efforts to strengthen the global competitiveness of advanced industries, which play a critical role in national economic security amid growing uncertainties and intensifying global competition.

The fund is expected to have several positive outcomes, including job creation, technological advancements, and enhanced international competitiveness in the supported sectors. For instance, the semiconductor industry, a major export sector, will benefit from 8.4 trillion won in policy finance, including 4.25 trillion won in ultra-low-interest facility investment loans at the level of 2% government bonds. This investment is expected to secure technology prowess and better ensure economic security, ultimately contributing to the country's long-term economic growth.



The fund will earmark 4.6 trillion won for research and development projects to help companies develop key technologies. This investment in R&D is expected to drive technological advancements in the supported industries, enabling South Korea to stay at the forefront of innovation. Additionally, the government is planning to open more courses at graduate schools to nurture experts in these fields, addressing potential workforce development challenges.

By supporting advanced industries, the fund is likely to create new job opportunities in these sectors. For example, the semiconductor industry alone is expected to create a significant number of jobs as it plans to invest 500 trillion won (US$377.67 billion) combined by 2027. This investment is expected to secure technology prowess and better ensure economic security.

In conclusion, the establishment of the $34 billion fund aligns with South Korea's broader economic policy framework, focusing on high-tech sectors and advanced industries. The expected outcomes of this initiative include job creation, technological advancements, and enhanced international competitiveness in the supported sectors. This investment is a testament to the government's commitment to fostering innovation and ensuring the country's long-term economic prosperity.