Gov't picks 25 'growth engines' to drive regional development across 7 zones

The government has selected 25 growth engines to lead regionally driven development under a "five poles, three special zones" framework and pledged close support for each.

Minister of Trade, Industry and Energy Kim Jung-kwan unveiled the plan — formally titled "A Strategy for Nurturing Regional Growth Engines Linked to Three Mega-Projects" — at the 10th Central-Local Cooperation Council meeting held at Cheong Wa Dae on Wednesday, presenting the 25 growth engines and their support plans.

The Ministry of Trade, Industry and Energy said it selected three to four growth engine industries for each of seven regions outside the Greater Seoul metropolitan area, based on corporate investment tied to mega-projects, each region's strengths, growth potential and alignment with national strategy.

The central region will develop next-generation displays and semiconductors, high-value-added bio-pharmaceuticals and materials, advanced batteries, and future defense and transportation systems as its growth engines, with the goal of building a global hub for advanced strategic industries.

The southwestern region will cultivate future power systems, advanced semiconductor innovation manufacturing, AI-based autonomous driving, and next-generation vaccines and precision medicine, anchoring a renewable energy-based semiconductor and AI cluster.

The Daegu-North Gyeongsang region will be developed into a center for advanced materials, components and AI robotics, focusing on semiconductor advanced materials and parts, secondary battery core materials and resource recycling, advanced mobility components, and cutting-edge AI robots.

The southeastern region will grow into a "super-gap manufacturing AI hub belt," with advanced shipbuilding and shipping, space and aerospace defense, future mobility innovation manufacturing, and next-generation nuclear power and energy as its designated growth engines.

North Jeolla Province will focus on green hydrogen platforms, advanced robot foundries, and agricultural and life-science biotech, while Gangwon Province will concentrate on smart bio and medical devices, specialty semiconductors and ceramics, and clean resources and tourism.

Jeju's growth engines are a renewable energy convergence system, a small satellite system, and clean bio-wellness.

AI industries will be applied as a common element across all regions.

The government will actively support the growth engines through a seven-pillar policy package — covering fiscal, financial, tax, regulatory, technology, talent and infrastructure support — alongside a mega special zone regime.

The government will establish a special subsidy for growth engines to support large-scale regional investment, channeling more than 80 trillion won ($57.8 billion) — representing 40 percent of the National Growth Fund — into regional investment while also creating regional funds.

Regional companies will receive an additional tax deduction of up to 50 percent on top of existing credits for research and development costs, integrated investment and domestic production tax credits, varying by region. Tax benefits for workers at regional small and medium-sized enterprises and for startup companies will also be strengthened.

Alongside this, the government will ease corporate investment regulations through the designation of mega special zones and launch regional growth engine task forces to resolve obstacles to corporate investment.

A new large-scale R&D program will also be established for growth engine projects pursued by consortiums of regional anchor companies and their partners.

The government will support talent development through package assistance for regional hub national universities, industry-academia convergence districts and specialized graduate programs, while building industrial bases including corporate-type advanced cities, renewable energy self-sufficient industrial complexes and manufacturing AI transformation clusters.

The ministry also plans to secure competitive industrial sites by ensuring timely supply of electricity and water.

The ministry said it would work with local governments to draw up regional growth engine development plans this year and provide close support for key regional projects through a locally led growth consultative body that includes local government participation.

On the mega special zone initiative, the ministry said it is gathering opinions from industry, labor and related ministries, and plans to advance the necessary legislation in cooperation with the National Assembly.