Hyeong-il Lee “We need to proactively discover and strengthen weak links in the supply chain.”

Deputy Prime Minister and Minister of Finance and Economy Lee Hyung-il said on the 12th, "We need to go beyond short-term crisis response and proactively identify and strengthen weak links in the supply chain."

Deputy Prime Minister Lee said this after presiding over the Supply Chain Stabilization Committee at the Seoul Government Complex on this day, saying, “As experienced in the recent Middle East crisis, a disruption in a single item or logistics route can quickly spread into a crisis in the overall economy.”

At the meeting, the supply chain stabilization fund operation performance and future plans, economic security item and service reorganization plan, patent strategy support plan, vehicle element Taso stockpile improvement plan, and naphtha and crude oil supply and demand plan according to the continuing situation in the Middle East were discussed.

Deputy Prime Minister Lee assessed, “As the competition for global technological hegemony intensifies and the war in the Middle East prolongs, supply chain instability is not a temporary variable, but is becoming a structural risk that our economy must constantly manage.”

In the future, the government will strengthen the connection between the supply chain stabilization fund and supply chain structure improvement policy to establish a new support program for stockpiling strategic materials and diversifying import lines. Based on the 200 billion won reflected in next year's government budget, the government will expand investment in projects to secure overseas production bases, which are highly important to the supply chain but are difficult for the private sector to invest in alone.

Key items in high-tech industries such as semiconductors, renewable energy, space and aviation are additionally designated as economic security items, expanding the number of economic security items from 327 to 340.

In addition, the existing system of categorizing and managing items into grades 1 to 3 will be reorganized into a ‘primary-general management item’ system.

Approximately 100 priority management items will be selected, focusing on key minerals, materials, parts, equipment, and items important for stabilizing people's livelihoods that need to preemptively respond to external risks such as export controls, and monitoring will be strengthened through the pan-ministry integrated early warning system (EWS), which is scheduled to be piloted in November.

For key management items, we plan to effectively deploy limited policy capacity by strengthening financial and tax support, including preferential interest rates of up to 2.3 percentage points (p) for the Supply Chain Stabilization Fund.

The government also decided to use patent big data to support securing core technologies needed to stabilize the supply chain.

By utilizing big data of approximately 600 million global patents, we discover alternative suppliers for items and technologies that are highly dependent on specific countries, and support technology transfer strategies to domestic companies through collaboration with domestic research institutes.

We provide supply chain technology diversification information based on patent analysis to supply chain-related companies, and also support patent creation strategies to secure promising supply chain patents for companies that require technological advancement.

We plan to build a 'supply chain patent strategy map' for each industry to proactively discover areas that require technology security and patent selection, and use it to establish future industrial strategies.

In addition, the management system will be improved to increase the effectiveness of stockpiling vehicle elements. Safety stock is set at 70% and on-site inspections are strengthened so that stockpiles can be used immediately in the event of a supply chain crisis, and the government directly stores some and manages it stably.