Regulations Hindering Business Investment Should Be Eased Across the Board

The government has announced that it will remove obstacles to corporate investment and bring forward investment worth 4.2 trillion won. The “On-site Centered Measures to Support Corporate Investment and Innovation,” announced on the 13th, includes steps to improve regulations and administrative procedures in the semiconductor, secondary battery, bio, and robotics sectors. The goal is to reduce cases in which companies, despite being ready to invest, are forced to wait because of outdated systems. If simply fixing a few procedures can unlock more than 4 trillion won in investment, that means the system has been holding businesses back all along.

The biggest project is the expansion of factories in the Yongin semiconductor cluster. Until now, whenever additional facilities were added during construction, the existing building permit had to be revised again. The government has decided to amend the Building Act so that additional facilities can be approved separately. This measure is expected to bring forward investment worth 2.5 trillion won. In other words, unnecessary permitting procedures have been delaying large-scale investment.

Regulations that failed to keep pace with industrial change have also become obstacles. The secondary battery recycling business was classified as a waste-related industry, restricting its entry into industrial complexes, while bio companies found it difficult to expand factories because of adjacent greenbelt land. Collaborative robots and mobile robots have emerged, but safety standards are still geared toward fixed robots. Semiconductor plants have also faced delays in equipment operation because of complicated inspection procedures. If new industries are forcibly fitted into outdated classifications and standards, corporate innovation is bound to be delayed. Regulations, too, must change in line with developments in industry and technology.

The cost of regulation may not be visible, but it is by no means small. When factory construction is delayed, investment capital cannot be translated into production, and hiring is postponed as well. In the meantime, if rival firms capture the market first, the investment plan itself may fall through. The government’s statement that revising several regulations and procedures could bring forward more than 4 trillion won in investment means that the regulatory costs businesses have borne until now have been that large.

The key is implementation. Legal revisions and approvals must actually be completed before companies can execute their investments. If the government announces regulatory improvements but inter-ministerial coordination and local government administrative procedures drag on, companies will once again be forced to wait. Timing matters in corporate investment decisions. The government must speed up institutional reform until investment plans lead to actual factories and jobs.

The government’s role is to create an environment in which companies can invest. Businesses monitor market changes and invest by assuming risks on their own. If they succeed, they earn profits; if they fail, they bear the losses themselves. Rather than steering investment through subsidies and tax incentives, the first priority should be removing the regulations that stand in the way of businesses. That is why this policy direction—listening to voices from the field and fixing unnecessary systems—is desirable.

Regulatory improvement must not remain limited to advanced industries and large-scale projects alone. Semiconductors and bio are important industries. Investment in other industries should be treated by the same principles. If exceptions are granted only to industries chosen by the government and to large projects, deregulation itself becomes another form of special treatment. If a divide emerges between firms that receive exceptions and those that do not, regulations will remain in place, while only the structure in which companies must rely on the government’s judgment becomes further entrenched.

Regulatory reform must go beyond simply handling complaints from individual companies. A regulation that blocks one company’s investment may impose the same burden on others. The government should use difficulties in the field as an opportunity to review the regulatory system as a whole. Regulations that are no longer necessary should be boldly abolished, and when new regulations are created, the cost they will impose on business activity should be examined first.

Regulations that obstruct corporate investment must be eased across all sectors. Investment moves to places where regulation is light, permits and approvals are fast, and institutions are predictable. Standards for safety and the environment should be upheld, but outdated procedures and industry restrictions must be boldly removed. This latest measure must not stop at resolving the difficulties of only a few advanced industries. The government should focus on creating an environment in which all businesses can invest and compete freely.

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Original title: 기업투자 막는 규제, 분야 가리지 말고 풀어야

Author: Sung-no Choi

Date: 2026-08-26

Source: https://www.cfe.org/bbs/bbsDetail.php?cid=press&pn=1&idx=29448