Korea launches $102 bil. fund to foster high-tech industries

Trade Minister Kim Jung-kwan, fifth from left, and other participants clap their hands at the Public Growth Fund meeting held at the Korean Chamber of Commerce and Industry in Seoul, Dec. 4. Joint Press Corps

A mega-sized fund aimed at supporting investments in key sectors, such as artificial intelligence (AI) and other advanced sectors, set sail Thursday as the country seeks to nurture its potential new growth engines.

The Financial Services Commission (FSC) said the 150 trillion-won ($102 billion) public-private fund, one of President Lee Jae Myung's key economic pledges, is aimed at accelerating AI adoption across sectors and channeling resources into key industries, including semiconductors, secondary batteries, biotechnology, energy, hydrogen, defense, vaccines and robotics, over the next five years.

The so-called Public Growth Fund consists of a 75 trillion-won government-guaranteed fund for strategic industries and 75 trillion won in private investment, encompassing direct and indirect financing, government-backed bonds and low-interest loan programs.

FSC Chairman Lee Eog-weon said the government, the financial and industrial sectors will together chart out a path for the fund to create growth engines for the economy.

According to the FSC, an investment strategy committee comprising government officials and industry experts will discuss the allocation of the fund into each promising and backbone sector.

Along with FSC Chairman Lee, Mirae Asset Chairman Park Hyun-joo and Celltrion Chairman Seo Jung-jin will serve as co-chiefs of the committee, according to the FSC.

Around 30 trillion won will be funneled into AI-related sectors, with 20.9 trillion won earmarked for the semiconductor segment, 15.4 trillion won for the mobility industry, and 11.6 trillion won and 7.9 trillion won for the bio and battery segments, respectively.

The FSC said the government has received around 100 proposals from local governments, business circles and others to invest in their projects.

The financial regulator said next year's fund management and investment projects will be finalized after further discussion.