By Kim Young Shin

The Ministry of Small and Medium Enterprises (SMEs) and Startups, established last year to tackle slow economic growth and economic polarization by helping to develop SMEs across all industries and all parts of the country, celebrates its first anniversary on July 26 this year.

“The ministry strived to realize an SME-centered economy by launching 64 policies and 904 assignments to boost jobs and wages, innovation and growth, and a fair economy,” said Minister Hong Jonghaak during a press conference at the Korea Federation of SMEs in Seoul on July 23. “The government will strengthen its efforts to visualize the effects of each of these policies.”

The Moon Jae-in administration’s SME policies strongly support startup companies with a range of new methods, quite different from previous administrations, and they are aimed at changing Korea’s conglomerate-heavy economy so that it becomes a SME-centered economy.

The ministry said that it boosted the effects of new policies on startups by changing the operations process of its Fund of Funds, to invest in startups suggested by civilians, and by taking public opinion into consideration when undertaking regulatory reform.

To create a fairer economy, the ministry invited small businesses that have not worked with major companies to start joint projects. It also prevented unfair practices, such as extortion of technologies or requests for excessive discounts. Additionally, it enacted a special law that cut conglomerates from invading small or local markets.

As for job policies, such as creating more jobs, supplementing minimum wages and aiding employment of young people, these new policies all reflected the voices of both employers and employees.

All in all, these new policies have created a better environment for startups and have ameliorated SME exports and productivity, the ministry said. However, there still remains many challenges ahead, including the bridging of the wage gap between big and small enterprises, and the income gap between business owners and employees, and improving the overall economic sentiment among SMEs.

ysk1111@korea.kr