Park eyes new venture boom
By Kim Tae-gyu
The upcoming Park Geun-hye administration plans to foster technology start-ups to reignite the nation’s venture boom, which is necessary to breathe fresh vitality into the slumping economy and create jobs for young people.
Toward that end, the new government will strive to create a business environment where small-sized companies can secure sufficient funds through “angel capitalists.”
“We have to encourage technology venture firms to create jobs for young people. In addition, they are good for economic growth because expansion boosted by big companies is in the doldrums,” a member of the presidential transition team told Yonhap news agency, wishing to remain anonymous.
He said that the initiative, tentatively titled “Venture Again,” will be announced in the near future.
This is not the first time that Asia’s fourth-largest economy has resorted to such a move to stimulate anemic economic growth. In the late 2000s, the Kim Dae-jung administration sought a similar strategy.
It seemed to work to an extent but was also at least partly responsible for information technology bubbles, which burst at the dawn of the new millennium to weigh greatly on the economy.
Worse, many con artists were found to receive government subsidies based on insubstantial technologies after allegedly giving money under the table to corrupt bureaucrats.
To prevent such a misappropriation of taxpayers’ money, Park’s administration is to help young entrepreneurs receive funds from the private sector such as angel capitalists.
Venture firms with a technological edge will get special treatment in being listed in the tech-laden Kosdaq or getting loans from financial institutes.
Thus far, the financial health of a firm has come first in Kosdaq listing or loan screening so that even start-ups with superior technological edges were excluded and the transition team thinks that should be changed.
In addition, the team stressed that private funds investing in start-ups must be nurtured.
President-elect Park Geun-hye recently said that Korea needs to emulate Silicon Valley of the United States where angel capitalists proactively compete to invest in start-ups with high commercial potential without any infusion of state money.
The transition team also expects that the new venture policy will be of great help in achieving Park’s promise of a 70-percent employment rate.
It measures the proportion of a country’s working-age population between 15 to 64. Korea’s employment rate was 58.3 percent last year and th just 39.4 percent for those below 30, according to Statistics Korea.