South Korea boosts public growth fund to 200 trillion won, targets climate finance and low-carbon transition

South Korea's Financial Services Commission is increasing the Public Growth Fund to 200 trillion won over five years, with a focus on aerospace and mega-tech projects like semiconductors and AI data centers. The plan includes expanding climate finance to 790 trillion won over 10 years to build power infrastructure for these projects and support a green transformation. Transition finance will be fully supplied to help high-carbon industries shift to low-carbon processes, and incentives like preferential guarantee rates will go to energy-saving corporations. The fund will also create a 150 billion won social investment fund and a super-long-term technology investment fund of 880 billion won with at least 10-year maturities. A specialized manager called Korea Strategic Technology Partners will be set up by policy finance institutions and private financial companies to supply up to 10 trillion won for R&D and localization of core technologies. The move signals a major push to align industrial policy with decarbonization goals.