"A New Venture Era in Agriculture" ... Gyeongbuk Province Creates 11 Billion Won Agri-Food Fund

Second after Gyeonggi-do among metropolitan local governments

The photo shows the scene of the Gyeongbuk Provincial Agricultural Research and Extension Services' agricultural product export promotion forum held on the 18th.

[Asia Economy Yeongnam Reporting Headquarters Reporter Park Dong-wook] Gyeongsangbuk-do announced on the 19th that it will establish Gyeongbuk's first agri-food fund to promote startup support for agricultural enterprises and attract investment.

The agri-food fund, named "Cheer Up Gyeongbuk! Regional Specialization Fund," will be created with a total of 11 billion KRW, including 5 billion KRW from the Ministry of Agriculture, Food and Rural Affairs' mother fund, 3 billion KRW from Gyeongsangbuk-do, and 3 billion KRW from private investments. The support targets agricultural enterprises located in Gyeongsangbuk-do as well as companies wishing to invest in the province.

The support conditions will also change significantly to take the form of unsecured equity investment or unsecured bond investment. Qualification criteria, credit ratings, and collateral requirements will be eliminated. By evaluating only ideas and business feasibility, the policy aims to make it easier for young people to start ventures in the agricultural sector.

As the second agri-food fund promoted by a metropolitan local government following Gyeonggi-do (which established a 10 billion KRW fund in 2018), the Gyeongsangbuk-do agri-food fund will operate for eight years starting from September this year when the fund management association is formed. The Korea Agricultural Policy Insurance and Finance Service (Nonggeumwon) plans to select a fund manager through a public offering from the 15th and complete the selection by June.

Gyeongsangbuk-do will invest more than 60% of the total fund amount itself and provide incentives to the fund management association for any excess investment.

The agri-food fund has been operating since 2010 by forming a total of 72 sub-funds (1.173 trillion KRW). According to Gyeongsangbuk-do, the settlement of eight funds that have completed operation showed an average return of 152% compared to the principal.

Kim Jong-su, Director of the Agriculture, Livestock and Distribution Bureau of Gyeongsangbuk-do, stated, “Due to the impact of COVID-19, new investments around agriculture and rural areas have decreased, and the regional economy has been severely contracted. Through the agri-food mother fund, we will do our best to foster young venture companies, create favorable conditions for investment, generate jobs, and increase the added value of agri-food products.”