MSS to Drive Job/Income Increase, Growth, and Innovation
- Division
- 국제협력담당관
- Date
- 2018.02.02
- Writer
- 소지혜
- File
- Headline
- MSS announces its plans for 2018. “the MSS will drive job/income-led growth and innovation by transitioning to an SME-centered economic structure,”
The Minister of SMEs and Startups (MSS, Minister: Jong-hak Hong) announced its plans for 2018.Minister Hong said in the announcement: “the MSS will drive job/income-led growth and innovation by transitioning to an SME-centered economic structure,” and added: “through these efforts, we will commit ourselves to raising the quality of living of Koreans.”
To this end, the Ministry plans to shift the focus of its SME policies to job creation, and achieve visible outcomes for the current administration. The gist of the new policies is as follows.
Firstly, the MSS plans to shift the focus of its SME policies to job creation. In this regard, the Ministry will raise the points assigned to job-related items when assessing applicants to its 37 SME programs (KRW 5.8 trillion) to concentrate its support on job-creating companies. The Regional Innovative Startup Cluster program will be reformed to expand the roles of private entities, and the MSS will create KRW 10 trillion of Innovation Venture Funds by 2022 (KRW 2.6 trillion in 2018) and promote in-house ventures (new program: KRW 10 billion) for creative activities in the private sector to generate more jobs. In particular, the Ministry will focus its support on business areas related with the Fourth Industrial Revolution (AI, robot, etc.) by granting more points to the areas and setting business development goals (in existing categories or new categories) to boost innovative start-ups.
Secondly, the MSS will drive revenue/income growth by encouraging companies to share the fruits of their growth.Here, the Ministry will promote shared growth between companies by, for example, requiring subcontractors who received cash payment to pay their own subcontractors in cash as well. A first-tier subcontractor who received cash payment should pay its second-tier subcontractor in cash as well. The Ministry will also crack down on technology theft and unfair trade practices by facilitating technical data deposit and reinforcing the existing dispute mediation programs. To promote cash payment among enterprises, the promissory note system will be phased out by 2022 under a specific road map.
Thirdly, the MSS will promote innovation by collaborating with micro enterprises to protect their business areas. The Ministry will help create new Innovative Micro Enterprises (15,000 by 2022) and ensure that micro enterprises can survive on their own by organizing and promoting collaborations, and designating and supporting 100 Hundred Year Shops (30 years or more in business). To protect micro enterprises from unfair practices, the Ministry will introduce new regulations on online marketplaces* and pursue the enactment of a legislation against gentrification to prevent excessive rent increase. New efforts will also include installing firefighting facilities based on the IoT technology in traditional markets and promoting merchant-led growth of traditional markets where the government supports innovative business proposals from merchants and traditional markets.
Fourthly, the MSS will promote innovation-based growth of SMEs and help enterprises stabilize their businesses. The Ministry will subsidize KRW 1.1 trillion worth of R&D projects. (AI/Big Data, 5G, intelligent sensors, information protection, smart appliances, robots, bio, wearable, etc.) To foster innovation at manufacturing sites, the Ministry will build 2,000 smart factories (20,000 by 2022) and pilot factories (six locations) to serve as benchmarks. The Ministry will help businesses expand their revenues from new technologies and new products. The Ministry will introduce minimum purchase requirements for start-up products in public institutions, so that the total purchase of the products by public institutions will be at least KRW 80 trillion. It will open shops dedicated to SME products in duty free shops and distribution networks (13 locations), and develop flagship shops specializing in quality products developed by innovative businesses. It will open localized online marketplaces outside Korea, which will serve as vessels to help SMEs expand their businesses overseas through K-wave marketing activities on social network platforms, and concentrate on supporting the top 1,000 exporters. For those companies participating in MSS policies for the first time, the Ministry will launch the “Policy First-Step Program” to lower the entrance barriers to the Ministry’s policies.
Minister Hong emphasized that: “the MSS will lead the efforts to achieve innovation on a daily basis, to ensure that our policies produce visible outcomes this year. We will dedicate ourselves to providing full support to SMEs, ventures, and micro enterprises.”
To this end, the Ministry plans to shift the focus of its SME policies to job creation, and achieve visible outcomes for the current administration. The gist of the new policies is as follows.
Firstly, the MSS plans to shift the focus of its SME policies to job creation. In this regard, the Ministry will raise the points assigned to job-related items when assessing applicants to its 37 SME programs (KRW 5.8 trillion) to concentrate its support on job-creating companies. The Regional Innovative Startup Cluster program will be reformed to expand the roles of private entities, and the MSS will create KRW 10 trillion of Innovation Venture Funds by 2022 (KRW 2.6 trillion in 2018) and promote in-house ventures (new program: KRW 10 billion) for creative activities in the private sector to generate more jobs. In particular, the Ministry will focus its support on business areas related with the Fourth Industrial Revolution (AI, robot, etc.) by granting more points to the areas and setting business development goals (in existing categories or new categories) to boost innovative start-ups.
Secondly, the MSS will drive revenue/income growth by encouraging companies to share the fruits of their growth.Here, the Ministry will promote shared growth between companies by, for example, requiring subcontractors who received cash payment to pay their own subcontractors in cash as well. A first-tier subcontractor who received cash payment should pay its second-tier subcontractor in cash as well. The Ministry will also crack down on technology theft and unfair trade practices by facilitating technical data deposit and reinforcing the existing dispute mediation programs. To promote cash payment among enterprises, the promissory note system will be phased out by 2022 under a specific road map.
Thirdly, the MSS will promote innovation by collaborating with micro enterprises to protect their business areas. The Ministry will help create new Innovative Micro Enterprises (15,000 by 2022) and ensure that micro enterprises can survive on their own by organizing and promoting collaborations, and designating and supporting 100 Hundred Year Shops (30 years or more in business). To protect micro enterprises from unfair practices, the Ministry will introduce new regulations on online marketplaces* and pursue the enactment of a legislation against gentrification to prevent excessive rent increase. New efforts will also include installing firefighting facilities based on the IoT technology in traditional markets and promoting merchant-led growth of traditional markets where the government supports innovative business proposals from merchants and traditional markets.
Fourthly, the MSS will promote innovation-based growth of SMEs and help enterprises stabilize their businesses. The Ministry will subsidize KRW 1.1 trillion worth of R&D projects. (AI/Big Data, 5G, intelligent sensors, information protection, smart appliances, robots, bio, wearable, etc.) To foster innovation at manufacturing sites, the Ministry will build 2,000 smart factories (20,000 by 2022) and pilot factories (six locations) to serve as benchmarks. The Ministry will help businesses expand their revenues from new technologies and new products. The Ministry will introduce minimum purchase requirements for start-up products in public institutions, so that the total purchase of the products by public institutions will be at least KRW 80 trillion. It will open shops dedicated to SME products in duty free shops and distribution networks (13 locations), and develop flagship shops specializing in quality products developed by innovative businesses. It will open localized online marketplaces outside Korea, which will serve as vessels to help SMEs expand their businesses overseas through K-wave marketing activities on social network platforms, and concentrate on supporting the top 1,000 exporters. For those companies participating in MSS policies for the first time, the Ministry will launch the “Policy First-Step Program” to lower the entrance barriers to the Ministry’s policies.
Minister Hong emphasized that: “the MSS will lead the efforts to achieve innovation on a daily basis, to ensure that our policies produce visible outcomes this year. We will dedicate ourselves to providing full support to SMEs, ventures, and micro enterprises.”