Ministry of SMEs and Startups Selects 10 Projects for '2021 Fairness and Quality Technology Development'
[Asia Economy Reporter Kim Bo-kyung] The Ministry of SMEs and Startups announced on the 2nd that it has selected 10 projects for the '2021 Process and Quality Technology Development' aimed at improving manufacturing processes to promote the return of overseas factories to Korea and prevent the relocation of domestic factories abroad.
This initiative supports technology development to convert labor-intensive and high-risk processes into automated and intelligent processes for manufacturing SMEs that have already relocated overseas due to high domestic production costs or are likely to do so.
The project selection this year was made after a public announcement in April and on-site evaluations by external experts, considering factors such as the demand for overseas relocation of domestic factories and the return of overseas factories to Korea, the necessity of process improvement based on labor intensity and industrial accident rates, and the need for government support in terms of production inducement and employment effects.
The 10 selected projects include 4 in the automotive sector, 3 in the plastics sector, 2 in root technologies (welding and casting), and 1 in the COVID-19 diagnostic field. Each project will receive 1 billion KRW in technology development funding over two years.
Key selected projects are as follows. First, wiring harnesses that electrically connect electronic components inside automobiles have mostly been relocated to low-wage countries overseas such as China and Vietnam. In February last year, Hyundai Motor's production was halted due to a disruption in wiring harness imports caused by COVID-19.
In response, KMDG Tech, a wiring harness equipment manufacturer, plans to develop technology to automate the entire process into a single unit automated process and supply automated equipment to manufacturers to improve productivity and encourage domestic return.
Jeonjin Heavy Industries, a manufacturer of construction equipment such as concrete pump cars, currently outsources part of its manufacturing process to low-wage countries like Turkey and is considering further relocating domestic factories overseas to countries such as China and India.
Through future development of technologies for simplifying pipe manufacturing processes, automating welding processes, and smart factory implementation, they plan to improve quality, reduce costs, localize all processes, and hire 10 additional equipment operation personnel without relocating factories overseas.
The Ministry of SMEs and Startups plans to steadily support process improvement technology development projects at a scale of 10 projects annually. Detailed information can be found on the Ministry’s website and the SME Technology Development Project Integrated Management System website.
Park Jong-chan, head of the Smart Manufacturing Innovation Planning Group at the Ministry of SMEs and Startups, said, "This project is expected to contribute to preventing the overseas outflow of manufacturing companies by improving productivity and reducing costs for SMEs struggling with labor costs and recruitment difficulties."
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