The Ministry of SMEs and Startups said at a Cabinet meeting on the 28th that public institutions' purchases of small and medium-sized enterprise (SME) products last year reached 126.2 trillion won, exceeding the original plan (119.5 trillion won).
Public institutions' purchases of SME products are mandatory under the Act on the Promotion of the Purchase of SME Products and Support for Market Expansion. A total of 847 institutions, including national agencies, local governments, and public enterprises, must purchase more than 50% of their total procurement in SME products.
By product category, mandatory ratios apply such as at least 15% for technology development products, at least 5% for women-owned business products, at least 1% for products from companies owned by people with disabilities, and at least 8% for startup products.
The Ministry of SMEs and Startups (MSS) said the performance was the third highest since the system was introduced in 2006. Considering the statutory target ratio (50%), the assessment is that the public procurement system is contributing in part to securing sales channels for SMEs.
The Ministry of SMEs and Startups (MSS) selects institutions as "excellent institutions" each year if their SME product purchase ratio is at least 85% and their purchase amount is at least 300 billion won. This year's list includes Gyeonggi Housing & Urban Development Corporation, KEPCO KPS, the Ministry of Education, Gimhae in South Gyeongsang Province, and Ansan in Gyeonggi Province.
Among them, Gyeonggi Housing & Urban Development Corporation recorded the highest performance for the second consecutive year with a 94.8% SME product purchase ratio. Many institutions also showed purchase ratios exceeding 90%.
The Ministry of SMEs and Startups (MSS) plans to continue to encourage the expansion of SME sales channels through the public procurement system this year. It will promote purchases through briefings and exchange meetings for public institutions, and push for improvements at institutions with low performance through fact-finding surveys.
Shim Jae-yoon, director-general for global growth policy at the Ministry of SMEs and Startups (MSS), said, "Amid difficult conditions such as high oil prices, high inflation, and stronger protectionism, public procurement is helping sustain SME sales," adding, "We will expand purchases of SME products to 170 trillion won by 2030."