Korea launches innovation plan

Dar es Salaam. South Korea is an advanced country economically and technologically. The country came second in the 2018 Best Countries ranking of most forward-thinking countries. Electronic consumer brands such as Samsung and LG are household names around the world, including in Tanzania. Visiting Seoul is akin to a tour of technological wonderland. But even more fascinating is the fact that the country has made significant progress - from a basket case to a donor country- in just about 50 years.

And yet Korean planners and strategists are not at ease with the progress made. They assert that something more should be done to transform Korea’s into a people-centred, sustainable and fair economy through creating a technological infrastructure and processes that would help the country as it re-positions itself to take its place in the 4th industrial revolution, Suh Kyusik, the director of the International Economic Cooperation in the Korean ministry of Strategy and Finance said in a briefing to journalists in Sejong, South Korea, last week.

Mr Suh noted that a review of various socio-economic indicators has unveiled a series of factors that would affect the growth and competitiveness of the country going forward, if not addressed.

One of these factors is low fertility rate. The birth rate in Korea has declined from one million per annum a few decades ago to 400,000 per annum in 2016.

“Korea’s birth rate is one of the lowest in the world and poses a threat to the workforce in future,” Mr Suh noted. South Korea has a population of 50 million (the country’s size is 100,032 square kilometres.

The slow growth in population due to low fertility might result in reduction in capital investments and a decrease in Koreans’ productivity.

The review also found stagnation in key Korean industries, Mr Suh said. Another aspect found in the review is the fact that the Korean economic growth is led by a few conglomerates, but the resultant monopoly have stunted the growth of a sizeable base of Small and Medium Enterprises (SMEs).

Innovation growth strategy

In order to solve the challenges facing the economy and reposition Korean economy, the South East Asian country’s strategists have come up with what they call innovation growth strategy.

“The strategy is a long-term continuous plan, unlike the five year development plans or 20 year development visions”, Mr Suh said.

And the focus of the innovation growth strategy on the “process of producing highly advanced, sophisticated technology” that would be rooted on social needs, the need for a cleaner air and a more health citizenry.

The strategy consists of three pillars that accommodate 13 areas that the government wants to promote. The three pillars are intelligent infrastructure, combined services and industrial foundation.

The areas under intelligent infrastructure are big data, artificial intelligence, 5G networks and Internet of Things, smart transportation, self-driving vehicles and drones.

Under combined services there are personalized healthcare, smart city, augmented/virtual reality and intelligent robot.

And yet areas falling under industrial foundation are intelligent semi-conductors, advanced materials, innovative medicine and new and renewable energy.

“We do not want to be in a position that our zeal for economic and technological innovation and advancement proceeds at the expense of quality working environment, social services and environment. So the focus on renewable energy, for example, aims at ensuring that the future Korea has cleaner air, and a healthier citizenry,” Mr Suh noted.

The plan is to promote innovative growth in each of the 13 sectors by introducing customised strategies for each, according to an analysis from government documents. The customised strategies include support for early commercialisation as well as for the development of original technology.

Accordingly, the government plans to support early commercialisation in the self-driving vehicle, big data, personalised healthcare, smart city, augmented/virtual reality, new and renewable energy, intelligent robot and drone sectors.

At the same time, there will be support for the development of original technology in the 5G network, Internet of Things (IoT), advanced materials, intelligent semi-conductors, innovative medicine and artificial intelligence sectors.

In the innovation strategy growth the government also plans to provide support for the broader use of products and technologies for public use, such as the wider use of drones in the public sector and the introduction of autonomous bus services in certain regions.

The innovation growth strategy will also involve improving learning environment in basic and higher education for creativity and convergence in order to create diverse and vibrant links between education and the labour market, Mr Suh told reporters.

It will also go together with deregulation to ensure that the laws do not restrict the expansion and utilisation of new technologies in Korea, which has been a long time complaint in the country.

Private-led strategy

Mr Suh stressed that the innovation growth strategy will be private sector-led as the economic policy of Korea states. The role of the government is to provide a clear direction and create conducive regulatory framework for the success of the strategy. The government will continue its investments in research and development but the focus would shift from quantity to quality.

Cost of innovation growth strategy

“It is difficult to put a price tag because the new strategy is going to be the way of doing things, not a one time off plan. But roughly estimates could point to something in the excess of Won 1 trillion (roughly $1 billion) annually,” Mr Suh said.

He added that the new focus on aspects like 5G, hyper-connected intelligence, smart factory, smart farm, smart city, self-driving cars, consumer drone technology are not meant to replace human labour but to add quality to it.

“Fears in some other parts of the world that artificial intelligence and such will render people jobless are unfounded. In Korea the advancements we are seeking will add more quality to human labour,” Mr Suh noted.