The South Korean government plans to promote investment in “green-growth” industries. The plan is aimed at creating fiscal funds and incentives, and expanding sources of financing, for those industries. The government’s plans involve a total investment of KRW107 trillion over the next five years, to create up to 1.8 million jobs.
The government is of the opinion that present funds available in the financial market and from the government are insufficient for “green-growth” industries, largely because such projects contain a large amount of uncertainty and only realise returns in the longer term. They are believed, however, to have external benefits to the country larger than those of other projects.
To attract private investment, the government decided to remove uncertainty by introducing a certification system to approve green technologies and projects and verify companies involved in “green enterprises” if they adhere to the government’s requirements. Certified companies would get favourable treatment, including fiscal incentives to be disclosed later this year.
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