South Korea Proposes 39.7 Trillion Won Finance Budget for 2027 to Boost Growth
Finance ministry earmarks 39.7 trillion won, focusing on future growth engines and export financing.
Quick Look
South Korea's finance ministry announced a 39.7 trillion won budget proposal for 2027, marking a 15.7 percent increase focused on future strategic industries, export financing, and supply chain security.
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Why It Matters
South Korea prepares its annual budget proposal to address economic growth strategies and supply chain resilience.
By Kang Yoon-seung
SEJONG/SEOUL, Sept. 1 (Yonhap) -- South Korea's finance ministry said Tuesday that 39.7 trillion won (US$29 billion) has been earmarked for the ministry under the government's 2027 budget proposal, with a focus on fostering future growth engines and expanding export financing.
The Ministry of Finance and Economy said the amount marks a 15.7 percent increase, or 5.4 trillion won, from the 2026 budget.
"The finance ministry will focus on providing capital and export financing to foster future strategic industries and supporting hyper-innovation economy projects through the budget in connection with the second-half economic growth strategy," the ministry said.
In detail, South Korea will establish a new strategic investment account under Korea Investment Corp. (KIC), the country's sovereign wealth fund, allocating 500 billion won.
The move comes as a growing number of countries are using strategic sovereign wealth funds to build national wealth, and as tools for strengthening economic security and pursuing proactive industrial policies.
South Korea will also launch a strategic export finance fund to better support exporters undertaking large-scale and long-term projects.
To address intensifying supply chain disruptions in the wake of the war in the Middle East, South Korea will set aside 200 billion won to establish domestic and overseas production bases for key products, marking a sharp increase from 10 billion won in 2026.
South Korea will additionally accelerate artificial intelligence (AI) and digital projects under the Economic Development Cooperation Fund, allocating $170 million for a project to establish an AI institute in Tanzania.
Under its hyper-innovation economy initiative, which focuses on gaining a competitive edge in emerging sectors, such as offshore wind power, green hydrogen and small modular reactors (SMRs), South Korea plans to spend 3.6 trillion won, up from 2.7 trillion won in the previous year.
The budget proposal, meanwhile, will be submitted to the National Assembly on Thursday.
What to Watch
AI outlook — possibilities, not facts
The budget proposal will be submitted to the National Assembly.
Very likely · Within days
Open Questions
- Will the National Assembly approve the budget proposal without changes?
