Drones have been designated as ‘competitive products’ among small and medium enterprises (SMEs) in Korea. The ‘Small and Medium Venture Business Division’ under the Korean government has made this designation in order to support SMEs and foster growth of new industries.
The competitive product designation system is one in which a public institution purchases products and services designated by the Ministry of Small and Medium-Sized Venture Businesses and one in which these products come from the SMEs that directly produce them. If more than 10 SMEs request the designation, relative sectors of government organizations will assess certain criteria and decide the final result. Designated products will remain in effect for 3 years, in accordance with Article 6 (4) of the ‘Enforcement Decree of the Act on Supporting Plans’, set by the government. This is to ensure the system’s stable operation and to prevent potential issues that may occur between purchasing agencies and suppliers.
Competitive products are designated once every 3 years in accordance with Article 6 (1) and (4) of the Enforcement Decree of the Market Assistance Act, but in this particular situation, the government decided to add drones as a special case. This is because it is common for small and medium sized enterprises to experience difficulties in securing market share due to the high market share of foreign companies, and it is possible to create a variety of new markets through merging the drone technology with navigation and simulation technology. Additionally, the Ministry of Land, Infrastructure, and Transport requested that the drones be designated as competitive products.
The Ministry of Small and Medium-Sized Venture Business stated that since the industry is currently dominated by multinational companies, domestic SMEs routinely experience difficulties in business expansion. However, many domestic SMEs have long since conducted research and have now developed high-level technology in navigation and simulation that can be applied to various fields. Thus, we can expect the drone industry and related SMEs to grow rapidly if the market sees continued governmental support.
(Top photo from 699pic.com)
This article, entitled “South Korea takes action to protect domestic drone industry”, was written in Korean by Yohan Son of Platum, edited by AllTechAsia.