The government will supply an annual guarantee of 1.5 trillion won for the low-carbon transition and technological innovation of small and medium-sized enterprises in the green industry to achieve its carbon neutrality goals. The plan is to expand guarantee support for small and medium-sized enterprises that are heavily affected by carbon emission regulations but have relatively limited financial capacity.
On the 5th, the Ministry of Strategy and Finance Minister Choi Sang-mok, who is acting on behalf of the President, presided over a meeting at the government's Seoul office which addressed national policy issues, economic relations, and strengthening industrial competitiveness, where the 'green industry support plan for transitioning to a low-carbon economy' was announced.
The government will initially provide annual guarantees of up to 1.2 trillion won for corporations that reduce carbon emissions to expand green investment. The support will target: ▲ the transition to a low-carbon business structure through the introduction of facilities and process improvements ▲ contributions to external carbon reduction through low-carbon technological innovation and commercialization ▲ sectors engaged in renewable energy production and industry. Guarantees will be supported at a maximum rate of 0.7 percentage points through agreements with banks.
Support will be provided throughout the entire cycle, from discovering carbon reduction activities to planning, commercialization, and post-management, fostering 'green unicorns'—innovative and leading corporations in carbon neutrality.
The plan is to discover 'innovation icons'—corporations with innovative green technology that have a high potential for growth as excellent medium-sized and global companies—and prioritize support when they promote low-carbon business transitions. Green innovation startups with high growth potential as unicorns will also be selected for scale-up support.
Separate guarantees of 280 billion won will also be provided to promote technological innovation in early-stage startups. The target is corporations engaged in economic activities that are compatible with the Korean-style green classification system (K-Taxonomy), such as greenhouse gas reduction.
The government plans to support guarantees by considering the economic and environmental values created by the technologies and businesses owned by small and medium-sized enterprises.
The government will also promote the activation of credit for green technological innovation. A maximum guarantee ratio of 95% (85% normally) will be prioritized, and a guarantee fee reduction of 0.4 percentage points will be applied, while agreed banks will support a maximum of 0.7 percentage points for two years. The average guarantee fee rate for corporations is 1.1 percentage points, which means that when a maximum reduction of 1.1 percentage points (0.4 percentage points from the guarantee institution plus 0.7 percentage points from the agreed bank) is applied, the actual burden on the corporations will be zero.
An official from the Ministry of Environment said, 'In the future, we plan to continue to discover corporations with high carbon reduction potential through field meetings and support guarantees.' Furthermore, they noted, 'We will continuously support the carbon reduction and technological innovation of small and medium-sized enterprises in the green sector in conjunction with the ministry's financial and non-financial support projects for the green industry.'