Deregulation is key to enhancing international competitiveness
The biotech industry's global market is valued at about 1,500 trillion won ($1.26 trillion). It is a futuristic sector, far more significant than semiconductors (400 trillion won) or automobiles (600 trillion won), on which Korea should focus.
That may explain why Economy and Finance Minister Hong Nam-ki said on Wednesday, "We should nurture the bio-health sector into a flagship industry as we did with semiconductors." Health and medical services have become a daily necessity after food, clothing and shelter. It is no longer an option but a must-do industry.
The Korean bio-health industry's technological level has reached 77.4 percent of that of the U.S., and the nation has excellent human resources in this area. However, the infrastructure for developing futuristic technologies here, in areas such as artificial intelligence, and precision and high-tech regenerative medicine remains weak.
The Moon Jae-in administration has selected the bio-health industry as one of three strategic sectors, along with non-memory semiconductors and future vehicles as future growth areas. However, it has done little concerning regulatory reform. Foreign competitors have set up bio-banks based on big data, but Korean firms are finding it difficult even to collect the relevant information.
Government officials, too, emphasize "regulatory reform" but their vows sound merely rhetorical. As things stand now, Korea may lag in the global competition for a healthcare revolution. Some are worried about deregulatory benefits concentrating on family-run conglomerates. It is also true, however, Korean cannot rely only on ventures and startups to develop this industry. Reducing red tape in dribs and drabs won't do.
It is reassuring the government has come to recognize the importance of the health and medical industry, given it will account for 20 percent of global GDP soon. The problem, again, is the snail's pace of deregulation. If the Moon administration has decided to promote it as a second semiconductor boom sector, policymakers need to prove they have the corresponding will and administrative flexibility.
Government officials should meet business executives to listen to their views on introducing open-ended regulatory reform. How to run the regulatory machine will decide winners and losers in the global bio-healthcare market. It is premature and preposterous to hear talk about a rosy industrial picture from officials who have yet to finish their homework.