South Korea's Ministry of Economy and Finance unveiled a package to accelerate KRW 7.9 trillion of delayed corporate investment, strengthen incentives for spending in traditional markets and regional commercial districts, and establish a government supported investment fund for children. The government also discussed a Korean Green Transformation strategy, which will target industrial decarbonization and green growth, and plans to publish it shortly. Investment measures include reducing the permitting period for a KRW 4 trillion conversion of an Ulsan combustion engine plant to electric vehicle production from three years to less than one year. The government will open a clean hydrogen power bidding market in October and revise its evaluation framework to support about KRW 3 trillion of investment in domestic hydrogen production and generation facilities. Regulatory changes will also permit integrated procurement of electrical and communications work for semiconductor fabrication plants and streamline approvals for additional gas cylinder cabinets used in semiconductor manufacturing. The revised Onnuri voucher program will provide a combined 10% discount and rebate in traditional markets and 8% in regional commercial districts, alongside preferential designation rules for qualifying shopping areas near traditional markets. From 2027, the Our Child Independence Fund will provide annual government contributions from birth through age 18 for children in households earning up to 150% of median income. Support will reach KRW 1.2 million annually for households at or below 50% of median income and up to KRW 1 million in matching contributions for those between 50% and 150%. The government will also pursue an exemption from interest and dividend income tax on investment returns for all participants, including children who do not qualify for fiscal contributions.

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