South Korea has consistently been one of the world’s top countries in terms of research and development expenditure as a percentage of GDP. According to the World Bank, South Korea’s R&D expenditure as a percentage of GDP was 4.81% in 2020, up from 2.3% in 2001. This is significantly higher than the OECD average of 2.4%.
The South Korean government has made significant investments in research and development over the years, with total R&D expenditures reaching 93.1 trillion won ($75.4 billion) in 2020 alone. This investment has paid off, as South Korea now ranks second among OECD nations in R&D spending as a percentage of GDP, behind only Israel.
In addition to government investment, private sector investment has also played an important role in driving innovation and growth in South Korea’s economy. In 2018, private sector R&D expenditures accounted for nearly 70% of total R&D spending in the country. This is significantly higher than the OECD average of 45%.
The South Korean government provides tax credits and incentives for corporate investments in R&D activities to encourage innovation and research and development activities further. In 2019, these incentives accounted for around 40% of all corporate tax incentives provided by the government.
Overall, it is clear that South Korea has made significant investments in research and development over the past two decades, which have positively impacted its economy and society. With continued support from both the public and private sectors, this trend will likely continue into the future.