South Korea’s National Assembly has greenlit a record $11.2 billion (KRW 16.5 trillion) budget for the Ministry of SMEs and Startups in 2026—an 8.4 percent jump from this year’s $10.4 billion (KRW 15.2 trillion). The move extends a four-year growth streak that has seen the ministry’s budget climb from $9.2 billion (KRW 13.5 trillion) in 2023 to its current peak.

The centerpiece of the 2026 plan is a major boost to SME R&D spending. After dipping to $952 million (KRW 1.39 trillion) in 2024, R&D funding bounced back to $1.04 billion (KRW 1.52 trillion) this year and will jump to $1.5 billion (KRW 2.2 trillion) next year—the largest allocation ever and a full reversal of cuts made under the previous administration.

The startup and venture ecosystem is also getting a significant lift. Government contributions to the Korea Fund of Funds will rise from $341 million (KRW 500 billion) to $560 million (KRW 820 billion), expanding support for regional investment, exit infrastructure, and second-chance funding for entrepreneurs.

A new Unicorn Bridge Program will deploy $22 million (KRW 32 billion) to back roughly 50 high-potential tech startups with an integrated support package covering commercialization, technology upgrades, and overseas expansion.

Early-stage founders stand to benefit as well. The Startup Package Program grows from $111 million (KRW 162.3 billion) to $133 million (KRW 195.2 billion), adding stage-specific commercialization support and AI-focused training. The Startup 1000+ Project for Cutting-Edge Industries, targeting deep-tech ventures, rises from $89 million (KRW 131 billion) to $99 million (KRW 145.6 billion).

Minister Seongsook Han said detailed rollout plans will be finalized by year-end, with the ministry focused on efficient execution to boost small-merchant recovery and accelerate growth across the SME and startup sectors.

Beyond these flagship initiatives, the budget funds a broad array of programs aimed at manufacturing competitiveness, small-merchant support, and cross-industry collaboration.

On the manufacturing front, smart factory adoption and upgrades will receive $275 million (KRW 402.1 billion)—up 70 percent from $161 million (KRW 236.1 billion) in 2025. Region-led AI transformation programs get $33 million (KRW 49 billion), up from $24 million (KRW 35 billion).

To help SMEs scale up, the Jump-Up Program doubles to $39 million (KRW 57.8 billion), while the SME Innovation Voucher Program edges up to $45 million (KRW 65.2 billion).

Export and strategic industry support includes a new $2 million (KRW 3 billion) K-Beauty Cluster Initiative and an expanded Export Consortium Program at $14 million (KRW 19.8 billion).

Small merchants and micro-businesses will see continued recovery assistance through Management Stability Vouchers at $395 million (KRW 579 billion), the Hope Return Package at $209 million (KRW 305.6 billion) for re-employment support, and Onnuri Market Vouchers at $313 million (KRW 458 billion). The Local Renaissance 2.0 program for commercial district development surges to $26 million (KRW 37.8 billion) from just $3 million (KRW 4.4 billion), while Entrepreneur-Type Small Merchant Development grows to $90 million (KRW 131.1 billion).

Collaborative growth initiatives round out the budget, with ESG-linked Co-Prosperity Programs for large and small firms at $14 million (KRW 20.1 billion), Smart Factory partnerships at $27 million (KRW 40 billion), Global Corporate Collaboration at $41 million (KRW 60 billion), and a Public-Private Open Innovation Platform at $17 million (KRW 24.2 billion).