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Share of the Business Service Industry to Rise to 6% of GDP in 2007
October 7, 2004
The government has decided to strengthen the competitiveness of the business service industry (B/S). Under the decision, the share of the business service industry will be increased from a mere 4.5 percent of the gross domestic product (GDP) in 2002 to 6 percent in 2007 and 8 percent in 2010.
To this end, it will expand the scope of small- and medium-sized companies, which now refers to those with less than 100 employees and 10 billion won in turnover. It has also decided to place emphasis on fostering professional manpower through a partnership program involving universities and businesses.
Along with this, to prevent the outflow of domestic technology, the government plans to enact the tentatively named "law concerning the prevention of the outflow of technology of advanced industries," which will make it obligatory to obtain approval from the government when seeking to sell or transfer any of the nation's core technologies.
The government held an economy-related ministers' meeting, which was presided over by Deputy Prime Minister and Minister of Finance and Economy Lee Hun-jai, on Sept. 18 and finalized the "measures to develop the business service industry and prevent the outflow of technology."
For the globalization of the domestic business service industry, which appears outdated when compared with those of advanced countries, the government will push for greater specialization and bigger service enterprises. Under the measures, the government will grant tax incentives to companies introducing advanced consulting techniques from abroad and add management consulting and market surveys to the scope of the latest consulting techniques.
To actively foster professional manpower, universities and business service enterprises will jointly conduct educational programs. In particular, the government plans to establish a college specializing in investment next year and operate an academic course for attaining a Master's degree in company inauguration.
The government will set up mid- and long-term R&D road maps for the development of theory and solutions for consulting methods. Some of the programs will be reflected in next year's project to develop industrial technology, if any are deemed urgent.
While accelerating business alliances with advanced companies and propelling the introduction of a system of qualification certificates for international consultants, it will expand incentives to superior certified service enterprises, including the extension of more funds for fostering the knowledge-based service industry.
To encourage outsourcing, it has decided to introduce a management consulting coupon system, which enables small- and medium-sized companies to receive management assistance services at low cost. Those using the service will be given tax benefits for expenditures and preferential treatment in attaining guarantees from the Korea Technology Credit Guarantee Fund and the Korea Credit Guarantee Fund.