Korea lays out 5-year plan to boost service industry

[서비스업 발전전략] 서비스업 키워 일자리 25만개 창출
The government has laid out an ambitious five-year blue print to boost Korea’s service sector… as it looks to breathe fresh life into the overall economy.
Hwang Ji-hye introduces to us, the plan which include increased investment, tax breaks and less red tape.
With the manufacturing sector losing steam due to sluggish global demand and fierce competition from China,… Korea has its eyes now set on services.
The government announced a set of measures on Tuesday to boost the service industry over the next five years… with the aim of creating an environment that encourages capital flows into the sector.
By 2020, the government will expand its financial support for the service industry by 15 trillion won, or roughly 13 billion U.S. dollars, while doubling its ratio of R&D investment set aside for the service sector to six percent.
It also plans to strip away regulations… and improve tax benefits.

“We will resolve the remaining problem of discrimination between the service and manufacturing sectors. The government will expand tax breaks for the service industry and amend tax laws so that service providers can receive benefits similar to those for the manufacturing industry.”

With these measures, the government expects the country’s annual growth rate to tick up by zero-point-1 to zero-point-2 percentage points every year until 2020.
Much of the support will be dedicated to seven specific fields: medical services, tourism, entertainment content, education, financial services, software development… and logistics driven by new technologies.
The government aims to add 250-thousand jobs in these fields by 2020,… but experts say that is far from enough.

“The total number of employees in the nation’s service sector is at around 18 million. I’m doubtful whether fostering just a number of services will help resolve the problems surrounding employment in the overall industry.”

So, what is urgent, the researcher adds… is reving up the low-value added fields of service… together with the high value-added sectors… that the government has designated as promising new growth engines.
Hwang Ji-hye, Arirang News.

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