The Financial Services Commission and the Ministry of Strategy and Finance announced on the 23rd that they have confirmed detailed implementation plans for the New Deal Fund at the ’23rd Central Central Countermeasures Headquarters Meeting for Emergency Economy and the 7th Korean Version of New Deal Ministers’ Meeting held at the Seoul Government Complex. .
The government plans to create a policy-type New Deal Fund worth 20 trillion won by 2025. It is intended to provide investment opportunities to the public by investing in various forms such as New Deal Projects and Investments and Loans for New Deal Enterprises, and using the private equity fund indirect public offering.
First of all, it is planning to create a child fund at the end of this year so that the fund can start from March next year. Based on this, the Financial Services Commission plans to form a fund worth 4 trillion won next year.
Various incentive systems are also created for participation in private investment. The policy fund management period, which is usually 7 to 8 years, is extended to a maximum of 20 years. Even if the fund management period is extended to 20 years, the total management fee will not increase significantly compared to the 10-year fund.
The policy investment ratio is also raised to a maximum of 45% (average 35%). It means that the government will bear this much to ease the risk burden when investing. For areas with high risk, the criteria for paying performance fees were also reduced to 4-6%. If you take the risk and invest, even if you make a minimum of 4% profit, the performance fee will also be covered by the boss.
The private equity fund indirect public offering, in which the general public participated, will be created with a priority of 140 billion won next year. In order to induce public participation, it was decided to increase the percentage of subordinated investment in finance to a maximum of 20%. The government is responsible for up to 20% of fund losses.
Investment resources for next year are divided into two categories:’Corporate Investment’, in which about 70-90% of the investment is allocated, and’Infrastructure Investment,’ in which approximately 10-30% of the investment is allocated, taking into account policy priorities and the use of investment funds.
First of all, the’investment proposal fund’ in the corporate investment sector receives a bottom-up investment proposal from the private sector, and the government reviews and selects it and distributes the funds.
This fund will focus on six key new deal industries such as △DNA △future car and green mobility △eco-friendly and green industry △New Deal Service △SOC·Logistics Digitization △Smart Manufacturing·Smart Farm.
In addition, large-scale funds necessary for M&A (mergers and acquisitions), acquisition of core technologies, R&D (research and development), facility investment, and business transformation are provided through a’growth-type fund’.
The’Infrastructure Investment Fund’ is mainly created for large-scale SOC (social overhead capital) investments such as data center construction and offshore wind power projects.
“The biggest feature of a policy-type New Deal Fund is that it is not an artificial fund allocation, but a market-driven fund,” said Do Gyu-sang, Vice Chairman of the Financial Services Commission. “Our financial sector will provide an attractive opportunity for long-term investment in the digital and green sectors.” Said.