Ministry of SMEs and Startups Launches Local Economy Revitalization Through Regional Business Collaboration... Up to 430 Million Won in Support

Local Governments to Design Collaboration Models and Identify Participating Companies
Project to Be Implemented in Consortium Format

The Ministry of SMEs and Startups is set to establish a virtuous cycle structure for local economies based on collaboration among businesses within each region.

On May 28, the ministry announced its plan to launch a pilot project titled the "Cooperative Regional Living Economy Revitalization Program," which aims to create added value through the integration of production and services within local areas.

There have been ongoing concerns that support focused solely on individual companies in regions with declining populations has limitations when it comes to expanding the economic impact on the local economy. Calls have also been made for a structure that connects production, processing, sales, and services within the region to create added value and recirculate that value back into the local economy.

In response, the ministry has designed this pilot project to demonstrate a collaborative model in which economic benefits circulate within the region, moving beyond support for individual firms to collaboration among local businesses. Local governments will directly design the collaboration models, identify participating companies, and implement the project in a consortium format.

The project allows for a range of collaborative methods tailored to regional characteristics, such as the development of joint brands, integration of production and processing, connection of local services, and establishment of shared-use infrastructure. For example, production, processing, and sales companies may share roles to build a local value chain, or market responsiveness may be enhanced through joint branding and sales systems.

A notable feature of this project is its emphasis on design and branding as core elements. The Korea Craft and Design Foundation will participate to support joint brand development, design improvements, and content planning.

Starting May 29, the ministry will accept applications from basic local governments in areas with declining (priority) populations that have a history of, or are currently engaged in, local industry promotion projects. Three projects in total will be selected, with each receiving up to 430 million won in support.

Kwon Soonjae, Director of Regional Enterprise Policy at the Ministry of SMEs and Startups, stated, "Going forward, it will be important to move beyond support for individual firms and instead foster collaboration in production, processing, sales, and services at the local level." He added, "Through this pilot project, we aim to discover region-specific collaborative models and further spread the virtuous cycle structure within local economies."

This content was produced with the assistance of AI translation services.