Minister of Trade, Industry and Energy Sung Yun-mo announces inter-ministry steps to counter Japan’s export curbs at Government Seoul Complex on Aug. 5. (Photo: MOTIE)

The government is venturing into R&D activities to promote the localization of the Korean raw materials, parts and equipment industries as Japan’s removal of Korea from a “white list” of countries subject to eased customs clearance took effect on Aug. 28.

The government, analyzing that the private sector-oriented R&D structure was blamed for a failure to localize core raw materials, plans to lead continued basic research by investing 5 trillion won in R&D over the next three years.

Prime Minister Lee Nak-yeon presided over an expanded ministers’ meeting of related ministries, including the Ministry of Science and ICT (MSIT), to cope with Japan’s export curbs on Korea and finalize R&D investment strategies related to the raw materials, parts and equipment industries.

The government aims to designate 100 core items and offer R&D tailored to meet their needs to foster localization.

Deputy Minister Kim Sung-soo of the Science, Technology and Innovation Office at the MSIT said, “As the government has so far concentrated its R&D to future industries, industries such as semiconductor and display have been neglected, so (the government) has decided to strengthen fundamentals of mainstay industries as steps to counter Japan’s export restrictions.”

The MSIT has designated the core raw materials and parts after consulting with related ministries. Some of the core raw materials and parts have been confirmed, but they will not be disclosed until localization is done.

The 100 core materials and parts are classified into four categories, including items with higher domestic technology levels and higher probability of diversifying imports.

In particular, if SMEs’ technology levels fail to catch up with demand from large-sized companies in semiconductor and display segments, support for basic research will be provided and R&D between SMEs and large-sized companies will be conducted under a contract to purchase items produced by the former.

The special committee on raw materials, parts and equipment technology - created under the umbrella of the Presidential Advisory Council of Science & Technology (PACST) - will be responsible for managing the 100 core raw materials, parts and equipment.

The committee will oversee categorization of core items, the establishment of R&D policies and reviewing and deliberation of the process of core item projects.

R&D outlays will amount to 5 trillion won from 2020 until 2022. R&D projects related to the core items and technology owner SMEs will receive part of the necessary money from the government, which will be exempted from expenditure restructuring.

Specific labs, research facilities and research teams will be operated by converging capabilities from state-financed research institutes in segments essential for securing proprietary technologies.

Research manpower will be concentrated to develop specific technologies, and research institutes and universities will serve as testbeds for commercialization.

MSIT Deputy Minister Kim said mainstay industries’ dependence on foreign import technologies will be lowered by translating Japan’s export curbs into opportunities.

The government will devote itself to conducting performance management to prevent taxpayer money from being wasted, he added.