The government and public institutions will collaborate with the private sector to establish a 'Global Plant, Construction, and Smart City (PIS) Phase 2 Fund' worth 1.1 trillion won. Through this fund, the plan is to actively support corporations' entry into overseas investment and development projects, as well as to promote winning contracts and expanding exports in high-value-added sectors such as infrastructure, urban development, and logistics.
The Ministry of Land, Infrastructure and Transport announced on the 25th that it will host the signing ceremony of investment contracts for public institutions, the first stage of the PIS Phase 2 Fund worth 1.1 trillion won, in Seoul. Ten public institutions participated as investors in fields such as overseas investment and development, infrastructure, and export finance.
The PIS Fund is a financial support program established since 2019 to systematically support corporations' entry into high-value-added overseas investment and development projects, moving away from simple contract methods in the overseas construction market.
Having started the first phase fund in 2019, approximately 1.4 trillion won has been raised to date, with plans to complete investments amounting to 1.5 trillion won by June of this year.
Thus far, investments have been made in 20 projects across various fields, including eco-friendly energy, roads, petrochemical plants, industrial complexes, and logistics centers in 12 countries such as the United States, the United Kingdom, Malaysia, and Saudi Arabia, yielding support effects for contracts and exports amounting to approximately $1.5 billion.
The PIS Phase 2 Fund plans to create a fund of funds with government finances amounting to 1.1 trillion won, which corresponds to 10% of the total size, and 3.3 billion won in public institution investments, which corresponds to 30%. It aims to attract additional private investments amounting to 6.6 billion won, which correspond to the remaining 60%, to form a total sub-fund of 1.1 trillion won.
The investment targets of the Phase 2 Fund are overseas investment and development projects in plants, transport and logistics infrastructure, urban development, and other fields in lower-middle-income and high-income countries. More than 60% of the total investment will be directed toward projects in which corporations participate for the purposes of winning contracts, exports, business development, and equity investments.
In addition, there are plans to actively support overseas projects led by public institutions participating in the Phase 2 Fund investment, enabling public enterprises with substantial experience and expertise in domestic infrastructure construction and operation to jointly enter overseas markets with private companies.
Following the signing of the investment contract for the PIS Phase 2 Fund, the creation of the sub-fund will begin immediately, with plans to commence full-fledged project discovery and investment starting in August, following the first phase fund of PIS, which concludes investments in the first half of this year, to continue financial support for corporations' overseas investment and development projects.
Minister Park Sang-woo noted, “The key driving force to lead the $2 trillion era following the achievement of $1 trillion in overseas construction contracts is investment and development projects. To improve our structure in this direction, it is essential to secure financial competitiveness.” He urged public institutions that have invested in this PIS Phase 2 fund of funds to take a leading role in strengthening the financial competitiveness of overseas investment and development projects.