According to Pulse by Maeil Business News Korea,

The South Korean government would allow further deregulation in the medical services, tourism, and financial services in an aim to bolster the services sector and domestic demand to help create jobs and growth amid uncertainties on the external trade front.

Through the set of tax, subsidy, and other policy incentives to seven services sectors - health and medical care, tourism, contents, education, finance, software, and logistics, the government hopes to create 250,000 jobs and bolster up to 0.2 percentage point in growth by 2020.

The government will increase the list of household emergency drugs such as pills for cold, indigestion, and fever that can be sold at convenience stores to 20 from 13 items. Telemedicine services to remote places will also be expanded.

The finance industry will be allowed to use a wider range of consumer data without personal information such as identities for marketing and development purpose.

Overlapped red tapes on hospitality infrastructures in nature reserve will be lifted. Selective buffer zones in mountain areas including the highland running across the Korean Peninsula from north to south will make places for hotels and restaurants. The government will work on developing customized tourism packages and programs to meet needs of different nationals.

Some of the restrictions on large companies’ access to the software market to protect startups and smaller companies such as Internet of Things, cloud computing, and big data service will be relaxed. The state will ease regulations related to personal information protection while maintaining the privacy policy to promote big data service sector.

The government will extend as many incentives to the services sector as offered to manufacturers. It will offer an equal scope of tax benefits to the services providers excluding a few sectors like gambling and bar and other entertainment as reserved for manufacturers.

The budget for policy loans via seven state financial institutions including Korea Development Bank, Industrial Bank of Korea, and Korea Credit Guarantee Fund to services sector will be increased to 54 trillion won ($46 billion) by 2020 from 39 trillion won last year.

The services portion in government procurements will go up to 30 percent by 2020 from 18.2 percent of last year.

Subsidies for research and development would be raised to up the share in the service sector to 6 percent from 3 percent. A total of 4.7 trillion won will be earmarked for R&D projects related to service industry until 2021.

By Cho Si-young and Chun Jung-hong

Copyrights Pulse by Maeil Business News Korea. All Rights Reserved.

Source: Pulse by Maeil Business News Korea (Jul. 6, 2016)