The Ministry of Knowledge and Economy (MKE) released their 2011 Operation Plan report on the 15th of this month. Next year, the Ministry is planning to focus on 3 objectives of shared growth, IT convergence and green growth as well as developing an advanced economy of over $100 billion in trade.
According to the report, 2010 was a promising year. Following successful hosting of the G20 conference as well as FTA agreements made with the US and EU, new markets such as IT convergence and Green technologies are beginning to emerge. However some uncertainties include increasing competition with the Chinese and other emerging economies and fluctuating material costs especially oil.
Growing up together
The main objective of 2011 as stated in the report is 'advanced economy with shared growth'. Although big economic threats have been averted by compact growth in exports led by conglomerates, imbalance between bigger companies and small/medium businesses have been reported as a problem. The MKE has identified this problem and will address it by creating a competitive 'eco-system' consisting of larger firms and smaller scale businesses, thus allowing both to thrive and increase competitiveness.
Shared growth is a key focus of the MKE in 2011 and projects will be implemented to increase infrastructure and support to strengthen the basis for shared growth. Major conglomerates have vowed to use 100 percent cash payments as well as fair trade agreements and increases in payments for received goods to the smaller businesses. The goal here is to promote private led support and culture of shared growth. The small/medium businesses will receive more support such as guidance from market experts, R&D aid and restorations of old work environments, thus creating a stronger business for a stronger partnership.
Strengthening the local industries
Local industries in the rural areas have also received attention, and the MKE has plans to increase self-sufficient industries in these areas. High quality manpower which has been reportedly lacking in rural areas will be distributed by localizing city-specific industries, creating more high level jobs and implementing projects to raise awareness of local industries for university students. Additionally, basis for growth in these areas will be supported with diverse goals for localized industries, industry-education cooperation clusters with more field activity and increased mutual cooperation between regions.
Shared growth is not limited to conglomerates and smaller businesses. The MKE has plans to support collaboration between manufacturers and service providers. These plans were developed to counter the imbalance of employment in the manufacturing sector compared to the service providers of these products. There are plans to develop service in order to create more jobs that will facilitate manufacturing such as new IT services like 3D convergence in medical, ship building and advertisement areas. Energy and fashion are two new areas that will be focused in the year 2011 with plans to develop new energy sources and R&D aid to design and industry related to the emerging fashion market.
Convergence and greener growth
Energy is a big issue everywhere in the world today, and this is not an exception for the MKE. In order to tackle the lack of core domestic energy technology, there are plans to overcome this with improvements in green energy growth using high IT competitiveness and diverse manufacturing bases. Convergence is another area which the MKE is interested in. Leading in many fields of IT convergence, the report suggests plans to further strengthen these areas to lead new emerging markets.
As the leader in semiconductors and various other IT technologies, the new target for 2011 is convergence with software and system conductor technology. The report states that this will allow new markets to be developed, allowing escape from being a 'follower' to IT convergence 'leader' status. As weaker parts of domestic IT, software and system conductors will be aided by several projects including R&D support and supply of expert manpower to further increase IT convergence competitiveness. In addition, convergence in bio/medical areas is being looked into with effort to increase export. Turning existing manufactured products to high value is one of the key areas which require convergence. Convergence on the whole will be encouraged as a culture while material manufacturers will be encouraged to establish markets overseas.
Major new markets for IT have been identified into two groups 'high touch' and 'high mix'. High touch includes the new touch screen related technologies such as tablet PCs, smart phones and smart TVs. High mix are mainly convergence technology products like advanced car navigation systems, ship navigation systems and agricultural systems.
Low carbon, green economy
In response to rising concerns on global warming, the MKE conveyed a strong message to meet global standards of reduced greenhouse gas production. Steps to implement and reinforce green economy systems are in place, including greenhouse gas reduction master plans and legal support for regulations. Voluntary participation from large companies will be encouraged as well as human resource support in related areas and focus on 'green life' to be implemented in everyday lives.
New replacement energy markets are also tackled in the report, with plans to increase exports in this area up to $50 billion until 2015. Strategic R&D efforts are being implemented as well as installing new energy technology in 10 major infrastructures (schools, ports and islands). There are also plans under way to create up to 50 'star companies' with over $100 million export revenue.
Efforts to create environments of overall increase in circulation of natural resources are being planned as well. The 'natural resources circulation industry information center' will be installed, and control of natural resources will be carried out through resource production goal setting and increase in green business management. Existing industries such as steel and chemistry will implement green economic models while new green industries are being developed.
In regards to energy, steps are being implemented to overcome the lack of domestic natural resources. Oil industries will be enlarged while gas industries are planning to enter the 'upstream' market. Development in Middle Eastern regions will have full support as well. The basis for energy supplies are being planned to be installed while there are movements to activate energy conservation market mechanisms.
$100 billion, the next goal
For the first time in 2010, Korea achieved 7th place in global trade after France and Netherlands through increased trade with emerging powerhouses such as India and China. Increased international leadership from the successful hosting of the G20 conference is also expected to facilitate the $100 billion trade goal.
In order to strive for this goal, the MKE emphasized an active response to global market changes. Plans are underway to achieve this through increased partnerships with emerging markets such as Africa. Existing partnerships will be strengthened through FTA agreements, and while some risks are being forecast, even more opportunities will be apparent according to the report. Besides trade, financial areas are also being looked into for realizing the $100 billion goal. In the 'G20 era', environments for global financial investments will be facilitated through implementations of systems such as free trade areas.
The MKE report also claims the importance of revolutionizing the industry platform to fit advanced economy. Plans are in motion to implement private funded R&D systems to increase R&D participation for future technology infrastructure and a knowledge/economy revolution. Efficient funding programs will be implemented in 2011, as well as advanced human resource development to meet increasing demands.
The report concluded with culture advancement through increased standard of living for all. CSR (Corporate Social Responsibility) for various companies will be facilitated through implementations of ISO 26000 guides. Various systems encouraging safe and reliable trade for all levels of society as well as energy safety, energy savings and financial support for lower classes are being evaluated.
