Implementation of Social Economy Enterprise Growth Program... Annual 50 Billion Won Raised for Social Investment Fund

[Image source=Yonhap News]

[Asia Economy Reporter Jang Sehee] The Ministry of Economy and Finance announced on the 4th that, starting this month, it will implement a joint intensive support program with related ministries to focus on the growth of social economy enterprises.

The government confirmed this content through the "2021 Social Economy Policy Direction" on the same day.

The support program targets five types of social economy enterprises with 4 to 10 years of operation: social enterprises, cooperatives, village enterprises, self-support enterprises, and social ventures. Going forward, they will receive comprehensive support worth up to 300 million KRW for business diagnosis, consulting, prototype production, and more.

The government also plans to establish a social finance system. It will activate special growth support guarantees for promising companies by increasing the guarantee limit up to 500 million KRW only for highly rated companies, and expand financial supply by raising 50 billion KRW annually for social investment funds.

Investment will also be promoted through institutional improvements such as allowing Shinhan Credit Cooperatives and the Korea Inclusive Finance Agency to invest in other corporations. Non-face-to-face sales channels will be strengthened through a dedicated social economy online mall (e-store 36.5), and support for overseas market entry will be expanded.

To enhance the competitiveness of major social economy enterprises, a support system for employee cooperative acquisition and conversion will be established, and through amendments to the Consumer Cooperative Act, the public responsibilities of consumer cooperatives will be specified, and the scope and subjects of support will be expanded.

By establishing grounds for the establishment and support of village enterprises, a social economy regional ecosystem centered on local and resident communities will be built, and efforts will be made to create regional social economy clusters through linkage of support institutions scattered across ministries within regions.

To alleviate housing poverty among youth and others, social housing will be activated with an annual supply target of 500 units by the Korea Land and Housing Corporation (LH) and 1,500 units by Seoul City. The social economy enterprises, which are entrusted operators of social housing, will be institutionalized to participate from the housing selection and design stages through purchase agreements and other means.

Additionally, the prompt processing of five laws requiring swift passage, including the Social Economy Basic Act, and the establishment of social performance measurement indicators and statistical systems will also be promoted.