Visiting Idimode, the minister for SMEs and Startups unveiled a plan to designate “Smart Manufacturing Specialist Companies”, publish an AI‑based Smart Manufacturing Innovation strategy and push subordinate rules and a possible new act to shift focus from isolated smart‑factory grants to sustained support for suppliers, data standards and workforce training.
Han Seong‑sook, South Korea’s minister for SMEs and Startups, used a visit to Idimode on 14 August to underline a stepped‑up drive to speed the digital and artificial‑intelligence (AI) transition of small and medium‑sized manufacturers, saying the ministry will build stronger institutional and legal support for the effort. The minister held a roundtable at the Geumcheon‑gu firm with experts, smart‑factory adopters and supplier companies to review on‑the‑ground results and to outline a package of measures that places suppliers and field‑level change at the centre of policy. (etoday.co.kr)
Central to the ministry’s approach, Minister Han said, is a new “Smart Manufacturing Specialist Company” designation intended to help capable suppliers scale into globally competitive specialist firms, backed by stage‑by‑stage support — from R&D and finance to market access. She also said an AI‑based Smart Manufacturing Innovation strategy will be published soon and announced plans to pursue a Smart Manufacturing Industry Innovation Act. Those commitments mirror pledges she made during her confirmation hearing and earlier public appearances to legislate more robust support for AI, data infrastructure and manufacturing solution providers. (etoday.co.kr, kukinews.com)
Those announcements sit alongside an existing, broader government strategy. In October 2024 the Ministry of SMEs and Startups set out an “intelligent (smart) manufacturing innovation ecosystem” plan that classifies the sector into four domains and 14 subfields, selects seven priority areas and pledged to designate 500 smart‑manufacturing specialist firms by 2027 while offering tailored support across R&D, finance, market access, human resources and data‑standardisation measures. The ministry has signalled the creation of regional AI centres and an integrated platform to underpin that ecosystem. (gov.kr)
There is also an existing statutory framework. The Act on Facilitation of Smart Manufacturing Innovation of Small and Medium Enterprises (Act No. 19181), enacted on 3 January 2023, already tasks the Minister of SMEs and Startups with five‑year master plans, permits designation of promotion and specialised institutions, and authorises measures ranging from smart‑factory supply and R&D support to digital clusters and manufacturing data platforms. The text gives the ministry powers to run surveys and training programmes and to apply for regulatory improvements — in short, it provides a legal basis for many of the policies now being fleshed out. (elaw.klri.re.kr)
Industry commentators and specialist outlets have flagged the ministry’s next steps as a move from law‑making to rule‑making and implementation. Officials have been preparing subordinate statutes and enforcement measures to operationalise the 2023 act, and the ministry has described follow‑on strategies that aim to embed AI, digital twins and autonomous production paradigms in future policy work. That implementation phase is where issues such as data standardisation, digital‑cluster creation and supplier nurturing are likely to be translated into concrete programmes. (e4ds.com)
At Idimode, Minister Han pointed to tangible shop‑floor improvements as evidence of what practical digitalisation can deliver. The company has established IoT‑based equipment monitoring, process analysis and production‑history management; the ministry says these systems raised equipment operating rates by about 25% and cut defect rates by more than half. Those figures were singled out at the roundtable as emblematic of the “field‑centred” gains the ministry wants to spread. Broad industry studies and government‑supported reports have recorded similar order‑of‑magnitude improvements after smart‑factory adoption — productivity uplifts around 25% and defective‑rate reductions in the high‑20s have been reported for firms that complete funded modernisation projects. (etoday.co.kr, trade.gov)
Participants in the Idimode roundtable urged practical priorities that reflect those shop‑floor realities: expanding data collection and AI application across small manufacturers; training AI specialists with manufacturing experience; guaranteeing continued operation and maintenance support for newly adopted systems; and developing AI tools to help prevent industrial accidents. Companies also called for policies that deepen the global competitiveness of domestic AI‑technology suppliers and for measures that make it easier for those suppliers to scale overseas. Minister Han said the ministry would actively reflect these proposals when finalising policy details. (etoday.co.kr)
Taken together, the ministry’s agenda — new specialist‑company designations, staged support packages, an AI‑centred strategy and proposed legislative work — signals a shift from one‑off smart‑factory subsidies towards an ecosystem approach that emphasises supplier capabilities, data architectures and workforce development. The practical challenge will be sustaining financing, filling skilled‑labour gaps and moving from pilot projects to broad, durable adoption across a large and diverse SME base. The ministry’s own plans include human‑resource programmes and regional hubs to address those constraints, while past government funding rounds and R&D commitments have already channelled significant resources into the sector. (gov.kr, trade.gov)
What to watch next is twofold: the content of the AI‑based Smart Manufacturing Innovation strategy the ministry has promised to release, and how proposals on new or revised legislation are framed in relation to the 2023 Act. The existing statute provides many of the policy levers the ministry now says it will use; the practical difference will be in the subordinate rules, funding commitments and implementation mechanisms that follow. If the ministry successfully aligns suppliers, standards and shop‑floor training with sustained finance and clear data standards, the government’s case is that the next wave of digital transformation could be more scalable and more durable than previous efforts. (elaw.klri.re.kr, e4ds.com)
(Reporting draws on the ministry’s on‑site briefing and coverage of the Idimode visit, the ministry’s 2024 policy announcement, the statutory text of the 2023 Act and industry assessments of smart‑factory outcomes.) (etoday.co.kr, gov.kr, elaw.klri.re.kr, e4ds.com, trade.gov)
Source: Noah Wire Services
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