Yi Whan-woo is a Korea Times journalist primarily covering finance. He writes in-depth articles on macroeconomy and financial markets and previously covered sports, politics, diplomacy and inter-Korean affairs, among others. Feel free to contact him at yistory@koreatimes.co.kr.
Is KDB up to task of executing W50 tril. fund for high-tech industries?
Members of the Korea Development Bank's (KDB) labor union protest in front of the firm's main building in Yeouido, Seoul, November 2022, against the government's plan to relocate KDB headquarters to Busan. An unusually high number of KDB workers quit in 2022 and 2023 due to the relocation plan. Yonhap
By Yi Whan-woo
The Korea Development Bank (KDB) is drawing attention over whether it is capable of managing a project initiated by the government to support high-tech industries, after many workers quit the state-run firm over the past few years, according to industry officials on Tuesday.
Operated under the Ministry of Economy and Finance, the policy bank has been tasked with creating a fund worth 50 trillion won ($34.29 billion) over the next five years.
The fund is half the size of the planned investment worth 100 trillion won to support advanced strategic industries, such as semiconductors, secondary batteries, displays, bio, defense and robots, in response to growing protectionism around the world.
The other 50 trillion won will be pooled from commercial banks. The 100 trillion project was jointly announced on March 5 by the finance ministry, the Ministry of Trade, Industry and Energy, and the Financial Services Commission (FSC).
“The grave task given to KDB shows the lender’s status as a responsible and reliable institution when it comes to national interests,” Shin Se-don, a professor emeritus of economics at Sookmyung Women’s University, said.
The FSC described financial support for high-tech industries as “KDB’s fundamental duty,” according to Shin.
The FSC recommended that KDB work on the creation of the fund separately from its current job to avoid possible regulatory breaches. The recommendation implicitly suggests the bank will need an additional workforce.
Acting President Choi Sang-mok, second from right, speaks during a meeting of economy-related ministers at Government Complex Seoul, March 5, when the government announced a plan to support high-tech industries. Yonhap
But whether the bank has sufficient personnel to undertake the government-initiated project remains in question, according to industry officials and bank employees.
They noted that 97 employees left the company in 2022, and another 87 quit in 2023, mainly in protest of the government’s push to move KDB’s headquarters from Seoul to Busan.
The number of those who left the company fell to 51 in 2024 when the ruling People Power Party (PPP) suffered a crushing defeat in the parliamentary elections in April of that year.
The relocation plan requires the National Assembly’s approval, meaning that it lost momentum after it was proposed in the name of balanced regional development.
Nevertheless, the number of KDB employees who quit last year is still high, considering the number of resignations ranged between 20 and 40 per year from 2013 to 2021.
A KDB labor union official said the company has been hiring rookies to “fill in a gap in the workforce.” He pointed out that those who quit were mostly working-level employees in their 20s and 30s.
“However, the company did not give a thought about additional workers needed to work on the creation of the fund,” the official said on condition of anonymity. "Under the circumstances, we may need relevant support concerning human resources to undertake the project on high-tech industries responsibly.”