Korea's Future Fund Should Finance the Next Boom
As Korea’s AI-memory boom lifts exports, profits, and tax revenue, the country has a rare opportunity to finance the technologies that could lead the next cycle. As Daniel Castro and Sejin Kim argue in The Korea Times, the proposed Future Response Fund should finance the shared capabilities, research infrastructure, and commercialization pathways needed to create the next boom.
With the fund’s structure and priorities still unsettled, Castro and Kim urge the government to establish a separate industrial investment window with clear objectives and public reporting. It should target gaps that existing budgets, policy banks, and private firms are unlikely to address adequately. Specifically, the fund should finance shared pilot lines, advanced packaging and testing facilities, large-scale testbeds, specialized engineering programs, and early supplier qualification. The fund should avoid subsidizing routine capital spending or becoming a permanent grant program for favored companies.
The authors also call for a stronger general research and development tax credit. While the fund would build shared capabilities and close commercialization gaps, a broader, more predictable credit would enable firms to pursue technical opportunities beyond government-designated strategic technologies. Both policies should be judged by results, including the time from research to first deployment, progress against global technology gaps, adoption by major customers, private investment, and exports.
As Castro and Kim state, Korea’s AI-memory lead will endure only if the country keeps earning it. The Future Response Fund should use today’s temporary windfall to address enduring commercialization gaps, not create permanent spending commitments.
