Business & Finance

South Korea Buoyant about Blockchain Technology as Government Earmarks 5 Trillion Won for Development

It was reported on August 13 that the South Korean government has decided to allocate 5 trillion Won (around $4.4 Billion) for 2019 in nurturing ‘eight sectors’ of the domestic economy, such as autonomous driving and smart factories, with particular focus featured on blockchain technology and it’s development.

In a meeting that was officiated by officials from the finance ministry, the government decided to increase the amount spent on crucial newcomers of technology such as blockchain, big data, and artificial intelligence (AI). The amount allocated supersedes the 2018 budgeting by a massive 65%.

The finance ministry said on Monday:

South Korea’s government will spearhead its innovative growth by spending big on key sectors in hopes that the private sector will follow suit.

From the meeting in Seoul on Monday, South Korea’s finance minister Kim Dong-yeon confirmed plans of a 5 trillion won investment toward its innovation program in 2019.

The measures will help facilitate the platform economy, which in turn will help speed up innovative growth.

Earlier, the ministry said that state-led companies plan to spend over 30 trillion won ($26 billion) in the eight leading sectors such as bio business by 2022, which could draw in private companies to invest and build up those areas going forward. Adding to it’s mid-term plans, the government also revealed that it will spend another 60 billion Won ($53 million) in nurturing of 10,000 specialist individuals for such promising sectors over the next 5 years.

Innovative growth is one of the key economic goals sought after by the Moon Jae-in government, along with income-led growth. The detailed comparison sourced by the finance ministry’s press release from 2018 to 2019 for growth through investment model is shown below.

Growth through innovation investment, 2018 and 2019

(billion won)

2018

(A)

2019 plan (B) Change
(B-A) y-o-y, %
Big data, AI, blockchain, sharing economy

  • Develop a big data platform
  • Ease digital divide and promote the use of big data analytics
579.9 1,040.0 460.0 79
39.7 190.0 150.0 378
6.8 130.0 120.0 1,765
Hydrogen fuel cells

  • Build a supply chain
42.2 110.0 70.0 166
37.2 100.0 60.0 161
Develop qualified workforce

  • Education program to grow 10,000 workforce
247.9 340.0 90.0 36
24.0 90.0 70.0 292
Subtotal for platform economy (C) 870 1,490.0 620 71
Future cars 590.7 760.0 170.0 29
Drone services 69.8 120.0 50.0 72
New energies 597.1 870.0 280.0 47
Healthcare biotechnology 271.8 350.0 80.0 29
Smart factories 444.6 1,030.0 590.0 133
Smart cities 76.7 130.0 50.0 65
Smart farms 114.4 240.0 130.0 114
Fintech 3.6 10.0 6.0 167
Subtotal for 8 pilot projects (D) 2,168.6 3,520.0 1,350.0 62
Total (C+D) 3,038.6 5,010.0 1,970.0 65

It is well evident of the particular focus from the government in the spaces of giant information, AI and Blockchain. Their shared financial system has jointly observed a funding of 579 billion Won ($511 million) in 2018. In 2019, Korea’s finance ministry will increase that amount to a whopping 1,040 billion Won ($918 billion) for the sectors. This gives close to a 80% build up in investments into these areas.

About development of ‘giant information platforms’, the Ministry stated:

The federal government’s center of attention will be selling giant information and AI in the growing blockchain era to verify information, control safety and boosting the shared financial system.

Seoul said it will also take drastic measures to ease regulations that have been blocking new industries and technologies from moving forward.

The ministry said that the government will launch a 2.6 trillion Won investment fund for startups this year, the first portion of a proposed 10 trillion Won investment fund that is to be created by 2020. Under the comprehensive plan, the government will focus on expanding the money supply for fledgling enterprises and creating a venture-friendly environment.

The ministry expect a total of 300,000 jobs to be newly created by 2022 under the support measures.

Backing blockchain tech is nothing new to South Korea, the government is taking an ever-increasing interest in ensuring its place at the helm of innovation worldwide. The developments come at a time when the country’s ministry of science and ICT is actively promoting blockchain education among Korea’s youth. The program sponsored by the country’s ministry of science and ICT will begin in September, and will focus on enhancing the youth’s exposure to blockchain and AI. They plan to alleviate unemployment among the South Korean youth and find the right candidates for the right positions moving forward.

Adding to that, the country’s Jeju Island has outlined a proposal to the government of it’s plans to become a ‘special zone for blockchain and cryptocurrency’ startups and firms wherein ICOs will be permitted in the province despite its ban in the mainland.

The finance ministry’s particular focus on development on blockchain technology among other innovation sectors of the modern world serves as a big notion to the government’s ambitions to serve as technological leaders of the world. This comes in a period where the world officials are confused about the prospects of blockchain and its vital applications, but the Seoul government seems to be bullish about the future prospect of this technology and are prepared to invest heavily in the technological future of South Korea.

Razi Khan

Researcher, Electrical Engineer and a teacher, Razi is one who takes great intrigue in the prospects of blockchain and cryptocurrencies (BTC in particular) while contributing a critical approach over the subject regularly. Contact the editor at editor.news@blockpublisher.com

Leave a Reply

This site uses Akismet to reduce spam. Learn how your comment data is processed.