South Korean Economy ‘Scale-Up’ Strategy Announced
Oh Se-hoon, the Mayor of Seoul, who is considered a potential candidate for the ruling party’s next presidential election, stated that the government’s most important role in corporate innovation and growth is regulatory reform. To transform the stagnant Korean economy into a ‘Scale-up’ economy, he proposed a strategy centered on comprehensive regulatory innovation. He suggested establishing a ‘Deputy Prime Minister for Corporate Growth’ (tentative name) to provide one-stop services for solving regulatory issues faced by companies and to shift government functions from a focus on regulations to a service-oriented approach.
On the morning of the 4th, Mayor Oh delivered a keynote speech on the topic of ‘Korea Growth Again (KOGA)’ at the ‘Corporate Growth-Oriented Regulatory Reform’ forum held at the Korea Chamber of Commerce and Industry’s International Conference Hall in Namdaemunro, Seoul. In his speech, Mayor Oh emphasized that through cutting-edge technology research and development (R&D) investment, tax and labor reform, and regulatory reform in the industrial sector, the stagnant Korean economy, hindered by missed opportunities in industry restructuring, financial innovation, and digital transformation, can be transformed into a ‘Scale-up’ economy.
He diagnosed that the Korean economy is at a turning point due to rapid changes in external conditions and technological shifts, such as the U.S.-China hegemony war, American centrism, the reorganization of the global supply chain, and digital innovation. However, its growth is being obstructed by unreasonable taxes, such as inheritance tax, and high regulatory barriers that could limit business even for the global top 100 unicorns and startups.
Mayor Oh argued that active financial investment in original technology development, financial revitalization, tax reform including inheritance tax restructuring, labor market flexibility, and labor reform that promotes incentives are methodologies to maintain an ‘operating growth rate (economic growth rate + inflation rate) of 5%.’