Discussions in the political arena regarding a plan to allow venture investments by the Export-Import Bank have intensified. The opposition party has proposed an amendment to the Export-Import Bank Act to permit direct investments in venture companies, and the ruling party is also acknowledging the necessity.
According to reports from the National Assembly and the financial sector on the 2nd, the Democratic Party of Korea's think tank, the Institute for Democratic Research, recently suggested in a research report that "to ensure smooth financial support from the Export-Import Bank, it is necessary to amend the Export-Import Bank Act to alleviate investment restrictions." The institute pointed out that the Export-Import Bank cannot make venture investments and stated that amendments to the Export-Import Bank Act should provide substantial support for building an artificial intelligence (AI) business ecosystem.
The current Export-Import Bank Act limits corporate equity investments to lending and guarantee-linked projects, making proactive funding for venture companies virtually impossible. Indirect investments are also only allowed in collective investment schemes under the Capital Market Act such as private equity funds, blocking investments in venture capital (VC) and new technology funds.
As the Democratic Party's think tank has proposed revisions to the Export-Import Bank Act, discussions between the ruling and opposition parties are expected to intensify. Currently, an amendment to the Export-Import Bank Act proposed by People Power Party member Choi Eun-seok is pending in the National Assembly. The amendment includes the removal of provisions that require linking overseas investment projects with lending and guarantees, as well as expanding investment targets to include venture investment associations and new technology investment associations. The Export-Import Bank also officially reported to the Presidential Committee on Policy Planning the necessity of revising laws to expand investments in venture and small businesses.
The chief expert of the National Assembly's Strategy and Finance Committee also recently expressed positive opinions regarding Choi's amendment in a review report. Chief expert Choi Byeong-gwon stated, "Due to the current law, indirect investments by the Export-Import Bank are not possible, so venture investments aimed primarily at overseas expansion are not adequately being made," adding, "If the Export-Import Bank Act is amended, it is expected to support effective overseas expansion of the rapidly growing innovative industries and discover investment opportunities."