Global Economic Times

South Korea Significantly Expands R&D Support for Foreign Investors, Accelerating Efforts to Become a Global Advanced Technology Hub: Global Economic Times Reporter / Updated : 2025-03-06 06:12:03

Seoul, South Korea – The South Korean government has announced a substantial increase in R&D support for foreign direct investment (FDI) companies, including a significant boost in budget allocation and a higher cap on cash grants. This strategic move aims to attract high-tech foreign companies to invest in R&D within South Korea, thereby strengthening the nation's advanced technology ecosystem and propelling it into a global innovation hub.

On June 6th, the Ministry of Trade, Industry and Energy (MOTIE) held a "Foreign Investment Company Field Meeting" at Danfoss Korea, an energy solutions company located in Jung-gu, Seoul. During the meeting, the government listened to the challenges faced by foreign companies investing in R&D in Korea and discussed ways to expand investment. The government aims to enhance the productivity and technological competitiveness of domestic industries by encouraging foreign companies with innovative technologies to establish a presence in Korea.

Key Expansions in Support:

Increased R&D Budget: The budget for the Global Industrial Technology Cooperation R&D program, dedicated to foreign-invested companies, will be more than doubled from 1.5 billion won in 2024 to 3.5 billion won in 2025.
Expanded Cash Grants: To attract R&D centers in advanced industries, the national subsidy rate for R&D investment cash grants will be increased by 10 percentage points, and the maximum support limit for advanced strategic technology R&D will be significantly raised from 40% to 75%.
Strengthened Global Cooperation: The government will promote a Global Innovation Investment Alliance to expand the participation of foreign-invested companies in the R&D ecosystem, building an international collaboration network.
Various networking and partnership programs will be supported to promote cooperation between foreign-invested companies, domestic companies, and research institutions.
Improved Investment Environment: Regulations will be eased and administrative support will be strengthened for the R&D activities of foreign-invested companies.
Professional consulting services, including legal, tax, and accounting, will be provided to help foreign-invested companies operate stably in Korea.
Public relations and marketing activities will be enhanced to attract foreign investment, and investment promotion seminars and roadshows will be held.
Support for Human Resource Development: Education programs and industry-academia cooperation programs will be supported to develop R&D personnel for foreign-invested companies.
Recruitment fairs and internship programs will be supported to help foreign-invested companies hire excellent domestic talent.

Yoo Beom-min, Director General of the Investment Policy Bureau at MOTIE, stated, "Most foreign-invested companies in Korea possess high technological capabilities. We will actively support them to contribute to the creation of an advanced technology ecosystem in domestic industries by expanding the attraction of R&D centers and R&D projects."

This expanded government support is expected to play a crucial role in strengthening South Korea's global competitiveness in advanced technology and building an innovative industrial ecosystem. Furthermore, it is anticipated to contribute to promoting technological innovation in domestic companies and creating new growth engines through cooperation with foreign companies.