Half a year has passed since the National Growth Fund was launched. The assessment is positive. First, the pace of execution is appropriate. In just six months, financing of 14.6 trillion won across 21 projects has been approved. The goal of providing 150 trillion won in support over five years appears to be on track. The supply of private capital exceeded expectations. Immunity for financial institutions engaged in investment and lending operations, along with measures easing the risk-weighted assets (RWA) burden on equity investments, proved effective. In particular, the public-participation type raised the reputation of the National Growth Fund to a higher level. It sold out ahead of schedule within five days. On some online channels, the allocated volume was exhausted in 10 minutes.
The National Growth Fund is differentiated from past policy financing. First, its scale is different. It is not indirect support centered on small-scale equity investments or guarantees. It executes large-scale investments to foster advanced strategic industries. The investment period is also long-term rather than one-off. Through distinctive fund structures such as large-scale scale-ups and ultra-long-term technology investments, it is laying the foundation for an innovative growth ecosystem. Investment fairness is secured through the Strategy Committee, the Fund Management Committee, and the Investment Deliberation Committee.
Of course, problems are also visible. Investment targets are limited. As the Korea Development Bank primarily selects investment targets, it is difficult to move beyond the range of companies the bank has traditionally invested in. There are also points raised that funds are concentrated only in companies or managers related to the National Growth Fund. Management measures must also be prepared for possible future insolvency or investment failures. The need to expand the scale and scope of support has also emerged. As the global investment war intensifies, whether the current scale of 150 trillion won is appropriate must also be assessed.
Above all, the success factor of the National Growth Fund is the discovery of promising investment targets. Inter-ministry collaboration is essential for this. The "Mother Fund–National Growth Fund relay," in which the Ministry of SMEs and Startups' mother fund discovers and nurtures startups and the National Growth Fund provides large-scale investment at the necessary time, is meaningful. The "Growth Company Discovery Council," jointly launched by relevant ministries, venture capital (VC), and private equity (PE), also draws attention.
But going further, a system that systematically discovers future strategic technology companies requiring large, long-term investment is needed. In that sense, expectations are high for the asset management company specialized in ultra-long-term technology investment that financial authorities are recently pursuing. Aiming to become like the U.S. DARPA, which invests in technologies with a high probability of failure but the potential to change the world if successful, a faithful outsourced manager specializing in technology evaluation must emerge. If a dedicated manager discovers future strategic technology companies and makes long-term investments of more than 10 years, it could also transform the industrial ecosystem.
Furthermore, an analysis of the appropriateness of the National Growth Fund's investment scale is needed. In the field, demand for investment support is already surging. Major global countries are also increasing their investment scale in advanced core industries to megaton levels. Support measures for industry sectors currently excluded from investment targets must also be explored. Beyond the 12 industry sectors including semiconductors, bio, and robotics, new investment sectors such as aerospace, cybersecurity, and advanced materials, parts, and equipment should be reviewed. As for investment methods, the proportion of equity investment or infrastructure investment and lending that shares outcomes together should be expanded rather than simple loans.
The National Growth Fund is a representative platform of productive finance. We expect it to continue to faithfully carry out its crucial role as a national growth engine. Through the discovery and support of clear future growth engines following semiconductors, I dream of a Republic of Korea where all can prosper together.
