[Manbo Jeongdam] Kang Seok-jin, Chairman of the Korea SMEs and Startups Agency, "We will become a 'Visiting Korea SMEs and Startups Agency' supporting unicorn leaps"

Interview with Kang Seok-jin, President of the Small and Medium Business Corporation
Emphasizing 'Visiting SBC'
Walking 15,000 Steps a Day to Travel Across the Country

‘Visiting KOSME.’

This is the slogan that Kang Seok-jin, the Chairman of the Korea SMEs and Startups Agency (KOSME), has upheld since his inauguration in September last year. Rather than waiting passively for support applications from small and medium-sized enterprises (SMEs) and startups, he aims to proactively visit business sites and provide tailored support to meet diverse needs. Chairman Kang envisions establishing a communication program centered on regional hubs under the brand ‘Visiting KOSME,’ continuing on-site management that can enhance trust.

Visiting KOSME is not just about busy employees moving around. For this, the leader must take the initiative and actively engage. SMEs and startups in need of support are scattered nationwide, and KOSME has 33 regional headquarters and branches. Naturally, physical fitness is essential for Chairman Kang, who must travel across the country. This is why he walks 15,000 steps a day. Kang said, "If I have no special schedule after work, I walk for about an hour. On weekends, I trek the trails around Wolasan and Yangmasan in Jinju, travel as far as Geumsan in Namhae, and climb Cheonggyesan in Seoul."

For Chairman Kang, who has made walking a daily routine whenever possible, Jinju, where KOSME’s headquarters are located, provides an optimal environment. Jinju has well-developed walking paths centered around the Namgang and Yeongcheon rivers. From almost anywhere, one can easily access paths along the riverbanks with just a little movement. On the afternoon of the 30th of last month, we walked together with Chairman Kang around the Namgang River and Jinju Fortress area, discussing KOSME’s role as an intermediary connecting the field and policy, and ways to improve policy services centered on SMEs and startups as the demand side.

Kang Seok-jin, Chairman of the Small and Medium Business Corporation, is walking through Jinju Fortress during an interview with Asia Economy. Photo by Jo Yong-jun

Below is a Q&A with Chairman Kang.

- You are now in your second year as Chairman of KOSME. Could you share your reflections so far and the key initiatives you have focused on?

▲ Work is done by people. The real substance of KOSME is the individuals and members working here. These people come together to form the living organism called KOSME. Each member’s role is crucial in supporting SMEs. Therefore, the most important thing is communication. We have fostered close exchanges and cooperation among employees. Through communication, understanding among staff has increased, and work performance has improved.

In terms of work, we support policies needed by SMEs and startups in various ways, but I felt regret over the relatively low awareness of projects other than policy funds. It is important not only to provide policy funds but also to support exports, manpower, startups, education, and other practical policies. We strive to make various policy project information easy to understand for companies and actively promote the agency’s role and value to the public, aiming to approach both companies and citizens with a friendly image.

- You emphasize ‘Visiting KOSME.’

▲ When KOSME announces loans, applications flood in. Just receiving these applications creates a lot of work, so previously, we selectively supported applicants. However, to truly enter the public’s space, KOSME must go out and visit. It’s not about receiving benefits just by applying well, but ensuring no company misses support due to lack of awareness. When companies are desperate and truly in need, they should not miss support because they don’t know about it. To this end, we are improving the delivery method of policy services and promoting rapid and proactive communication activities throughout the organization. We plan to provide a program that includes policy promotion, consultation, tailored linkage, lectures, and seminars at regional sites by area, operating flexibly depending on scale and circumstances.

- What are the voices you have heard from SMEs and startups through close communication on the ground?

▲ Recently, I visited the Sangpyeong General Industrial Complex in Jinju to inspect the situation of resident companies and had candid conversations. The biggest difficulty they expressed was manpower issues. Especially for regional SMEs, the manpower shortage is worsening due to the trend of regional population decline and the reluctance to work at SMEs. Many places are closing because they cannot find people. The key to sustaining SMEs and startups is ultimately ‘manpower.’

KOSME is supporting diversification of manpower supply channels, productivity improvement through strengthening the capabilities of current employees, and incentives for long-term employment to fill vacant SME jobs amid a declining working-age population. In the IT sector, we are preparing to support Vietnamese software personnel, who have relatively high technical skills and lower labor costs, to help domestic startups struggling to recruit. We are also promoting the inflow of foreign students in Korea into SMEs and startups. We plan to match them with local companies to provide manpower. For places struggling to find manpower on-site, we cooperate with the Ministry of Justice to assist with related tasks such as visa issuance. We also provide training using our training center. We are developing job training courses needed by various workers, including foreign workers and women with career breaks, to improve job adaptability, and collaborating with local universities and related organizations to nurture specialized personnel for regional industries.

Kang Seok-jin, President of the Small and Medium Business Corporation, is walking through Jinju Fortress during an interview with Asia Economy. Photo by Jo Yong-jun

- As part of solving manpower issues in SMEs, you recently launched the ‘Preferential Savings Deduction for SME Employees.’

▲ We thought about ways to help young people continue working at SMEs. The Preferential Savings Deduction for SME Employees is a product developed in collaboration with commercial banks to support long-term employment by offering preferential interest rates and reducing the burden on employers, enabling support for many prospective core personnel. Employers only need to contribute 20% of the amount employees save. Thanks to good cooperation between public institutions and banks, practical benefits are provided, and the number of subscribers is rapidly increasing.

- Domestic economic growth is slowing down. This must also affect SMEs and startups. Are there any support policies prepared to overcome low growth?

▲ We are focusing policy support such as funding, export, and manpower on SMEs and startups with strong growth potential in innovative growth sectors to help them grow into global unicorns and mid-sized companies. Next year, we plan to select 100 promising innovative growth companies and closely support their scale-up process through a new ‘Jump-up Program’ to help them grow into mid-sized companies. For a company to leap and grow, it must have a good strategy. This project provides that strategy. Through various private experts, we will establish scale-up strategies tailored to each company and focus on providing essential advisory services for company growth, such as overseas expansion and resolving technical difficulties. Based on this strategy, various commercialization costs directly required for scale-up will be supported in the form of vouchers, up to 250 million KRW annually for three years.

Focus and selection are also important in policy. The old ways have limits to growth. To open new paths, investment, not loans, is needed. While private investment should be substantial, public institution investment plays a pioneering role. I believe we need to increase such investments that can send messages to the private sector. Another reason why our SMEs hesitate to grow into mid-sized companies is the reduction of institutional support. When becoming a mid-sized company, government benefits decrease. The criteria for mid-sized companies need to be changed. There should be an active growth phase before becoming a mid-sized company.

Kang Seok-jin, Chairman of the Small and Medium Business Corporation, is standing on Chokseokru Pavilion at Jinju Fortress in Gyeongnam, talking about the Imjin War and Jinju Fortress. Photo by Jo Yong-jun

- The instability of the global economic environment continues. What are the support directions to promote globalization of SMEs and startups and resolve difficulties in overseas market entry?

▲ SME exports are showing a favorable trend, but geopolitical risks such as the US-China conflict, Russia-Ukraine war, and Middle East war persist. Our export companies are also exposed to exchange rate fluctuations, financial risks, logistics difficulties, and raw material supply issues.

Together with the government and related organizations, we believe it is crucial to leverage rapidly changing market conditions as opportunities. The Ministry of SMEs and Startups and KOSME have formed an export support consultative body. KOSME’s Global Business Center, K-Startup Center, and overseas bases, along with overseas diplomatic missions, form a support consultative body for SMEs and startups. Especially with the participation of overseas diplomatic missions, trust from foreign companies, buyers, and venture capitalists (VCs) has increased. Domestically, public institutions, private organizations, and associations have formed a one-team consultative body, serving as a bridge connecting the government, private sector, and companies. We aim to provide practical help to export companies by organically linking domestic and overseas efforts.

- How do you plan to lead KOSME during your remaining term?

▲ I will strive to enable SMEs and startups to grow into unicorns and mid-sized companies through innovative growth and globalization on a stable management foundation. First, we will provide sufficient and prompt opportunities to SMEs and startups that can recover and leap forward once they overcome difficult challenges. We will boldly support SMEs and startups with strong growth potential and firmly guide their overseas expansion to nurture them as ‘K-National Representatives.’ We will also respond to national future challenges such as declining working population, regional extinction, and climate crisis with policy measures to ensure the growth engine of SMEs and startups does not stop. To this end, we will visit companies to find what they truly want and need, provide tailored support, and foster a work atmosphere where employees work fairly and diligently.

Kang Seok-jin, Chairman of the Small and Medium Business Corporation, is walking around Jinju Fortress and the Namgang River in Gyeongnam. Photo by Jo Yong-jun

About Kang Seok-jin, Chairman of the Korea SMEs and Startups Agency (KOSME)…

▲ Born in 1959 in Geochang, Gyeongnam ▲ Graduated from Yeongnam High School ▲ Bachelor’s degree in Political Science and Diplomacy from Yonsei University ▲ Master’s degree from Yonsei University Graduate School of Public Administration ▲ Former Governor of Geochang County, Gyeongnam ▲ Senior Administrative Officer at the Presidential Secretariat ▲ Director and Executive Director at the Korea Technology Finance Corporation ▲ 20th National Assembly Member