Lee Hyoung-il, the new deputy prime minister and minister of economy and finance, said on his first day in office that the government will press ahead with a Korean-style strategic sovereign wealth fund. The plan is to have the state invest long-term money directly in national strategic industries such as artificial intelligence and semiconductors, and to share the returns with the public.
"As the president has said, we are pushing to introduce a Korean-style strategic sovereign wealth fund to lead the industrial economy amid international competition," Lee wrote on X, formerly Twitter, on the 22nd. "The fund will invest directly so that national strategic industries can grow over the long term and on a stable footing, and we will make sure the returns go back to the public." In July, the government announced a plan to create the fund by setting up a strategic investment account at the Korea Investment Corporation (KIC) to invest in strategic industries such as AI and semiconductors, infrastructure industries such as data centers, and companies critical to overseas supply chains. Unlike existing policy finance, which centers on loans and guarantees, the account would buy corporate equity directly and exercise voting rights where necessary. Initial capital is to be set at more than 20 trillion won ($14.4 billion).
The 20 trillion won will not be injected in cash all at once. According to materials the Ministry of Economy and Finance submitted to the National Assembly, cash-equivalent assets actually available for investment next year are expected to total about 1 trillion won, combining cash contributions and dividends from state-run institutions. The government plans to expand the fund in stages after reviewing investment demand.
Lee also signaled that the government will move quickly on the legal framework. "The ministry will communicate fully with the National Assembly on the related legislation and will carefully build out the investment framework so that the system can be introduced without a hitch," he said. The government aims to launch the strategic sovereign wealth fund next year after revising the Korea Investment Corporation Act and other rules. A day earlier, President Lee Jae-myung shared a newspaper column citing the U.S. government's equity investment in Intel and stressed the need for large-scale, long-term investment in strategic industries. The president shared Lee's message again on the day and wrote, "Deputy Prime Minister Lee Hyoung-il, I am counting on you." Lee replied, "I will work hard."
At his first meeting of senior ministry officials that day, Lee called for a fresh review of risks across the economy, including the property, financial and currency markets. "Re-examine from scratch the risks across the real economy and the property, financial and currency markets, and prepare the necessary responses pre-emptively," he said, also instructing officials to stay on top of pending issues such as investment projects in the United States.
He also flagged inflation and widening inequality as key tasks. "Price stability will be the foundation of stability in people's livelihoods," Lee said. "The ministry must step forward as the control tower of the economic team in easing polarization, which is a core task for our society." Lee did not hold a separate inauguration ceremony, instead airing a pre-recorded inauguration address over the ministry's internal broadcast system. He then visited the National Assembly's Finance, Economy and Planning Committee for a closed-door briefing on investment in the United States. He was scheduled to depart for New York that night to attend an investor relations event on the Korean economy for overseas investors.
