According to Yonhap News,

To promote corporate investment in regional areas, the limit on regional investment subsidies will increase from the previous KRW 10 billion to KRW 15 billion, and the subsidy support rate for small and medium-sized enterprises (SMEs) and middle-market enterprises investing in regional areas will be raised from an additional 5 percentage points (p) to 8 percentage points (p) and 10 percentage points (p), respectively.

On January 30th, the Ministry of Trade, Industry and Energy announced (MOTIE) that a revised version of the "National Financial Support Criteria for Regional Investment Enterprises Promotion by Local Governments" will be implemented starting from February 1.

This revision is aimed at promoting the relocation of metropolitan area companies to regional areas to revitalize the regional economy and encourage job creation.

According to the revised regulations, the limit for regional investment subsidies will be increased from KRW 10 billion to KRW 15 billion per project.

Additionally, the subsidy support rate for SMEs and middle-market enterprises investing in opportunity development zones will be increased from an additional 5 percentage points (p) to 8 percentage points (p) and 10 percentage points (p), respectively.

For leading companies investing in facilities for producing economic security items and services, the subsidy support rate for equipment will be increased by 2 percentage points (p), and the equipment subsidy support rate for companies investing in long-term unsold industrial complexes will also be increased by 2 percentage points (p).

Moreover, for companies that fail to meet investment targets due to unavoidable reasons, the restriction on reapplying for subsidies will be eased from three years to one year.

Meanwhile, the MOTIE reported that last year, it provided a total of KRW 339.6 billion in regional investment subsidies to 54 regional investment enterprises, including KRW 224.4 billion from the national government and KRW 115.2 billion from local governments, resulting in creation of KRW 2.4783 trillion in private investment and over 3,000 regional jobs.

The ministry emphasized that it contributed to strengthening the competitiveness of key industries, by providing KRW 101.7 billion in national funding to 24 companies in advanced strategic sectors like semiconductors, secondary batteries, biotechnology, and displays, as well as KRW 45.3 billion to 13 companies in the automotive sector, including electric vehicles.

A Ministry official stated, "We will continue to work with the Korea Industrial Complex Corporation and other stakeholders to ensure that the regional investment subsidy system, focused on the needs of local governments and enterprises, operates effectively."

dkkim@yna.co.kr

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Source: Yonhap News (January 30, 2024)

** This article was translated from Korean.