Chapter 3 examined domestic and foreign trends in the 6th industrialization and related policies. The chapter reviewed domestic trends in individual enterprises’ 6th industrialization and policies for the regional 6th industrialization, and conducted policy assessment targeting beneficiaries, thereby drawing implications. Also, this chapter examined the cases of Japan and Germany to derive implications for policy.
As shown in the analysis of conditions for cooperation for the sustainable regional
6th industry, the current state of and policies for the domestic 6th industry show that sound cooperation needs policies that create synergy from cooperation. Profit from cooperation should increase proportionally, and policy support for this is necessary. In addition, for sustainable cooperation, the profit should be reasonably distributed.
However, the present policies are insufficient to satisfy these conditions.
Planned preparation is also inadequate at the regional level. As pointed out in policy assessment, despite the enforcement of the related law and the establishment of the central government’s plan according to the law, planning at the regional level is insufficient. It is one of the reasons for difficulty in the systematic regional 6th industrialization. Planning is both the result and the process. The planning process is an opportunity to learn by forming a consensus and grasping reality. This implies that it is important to set up sound regional plans.
The cases of Japan and Germany were examined as overseas cases. The case of Japan has the following implications. First, as implementing actors are in a wide area, the content of projects should be clarified, and key actors are needed to faithfully carry out the projects for a long time. There were key actors in all cases of Japan’s regional 6th industrialization. The actors, including farms, agricultural cooperatives, local governments, and regional public organizations, are key members in the industrialization.
The key members need the ability to identify the overall regional reality such as local resources for the 6th industrialization, and the ability to embrace all members. This leads to the expansion of the range of business, which drives the sustainable 6th industrialization.
Second, the role of agriculture-related institutions, including local governments and agricultural cooperatives, is important in the regional 6th industrialization. For the industrialization, it is required to know the local reality related to agriculture, forestry, and fisheries, and exchange with local farms, companies, and other groups. Therefore, only agriculture-related institutions can play this role in a region. In the future regional 6th industrialization, the role of agricultural cooperatives will increase and has to be stressed more, because they have detailed knowledge on the region’s agricultural situation and resources.
The implications of Germany’s case are as follows. First, it is very difficult for
individual farms to independently develop items in the secondary and tertiary industries and run the business. Therefore, it is important to establish a harmonious partnership between actors in the agricultural sector and actors in the non-agricultural sectors with efficient sales nets and marketing systems. Second, in producing specialties with local features, it is needed to create synergy through cooperation with small and medium-sized enterprises that produce promising foods. Third, the regions where the 6th industry has developed in Germany have operated private-led regional councils for a long time, despite changes in the policy environment at home and abroad. Stably running regional councils and gaining actors’ trust are factors in sustained cooperation among actors in various sectors.
Chapter 4 analyzed ecosystems, value chains, and network activities in 4 case regions (Seocheon, Yeongdong, Sunchang, and Hadong) that carry forward the regional 6th industrialization. The analysis aimed to draw implications to build a healthy industrial ecosystem for the sustainable development of the industrialization.
According to the result of the network analysis, the overall regional cooperation network related to the 6th industry is growing, although there are regional differences.
The result of analyzing the cooperation network of companies that carry out the 6th industrialization in the 6th industrialization districts shows that the regional cooperation network other than direct business relations is growing with councils of enterprises, innovation actors, and support institutions in the region at its center. Particularly, councils of regional enterprises, including farming association corporations and research groups, play a central role in the cooperation network. Also, the network of regional support institutions, such as local governments’ research institutes and agricultural technology centers, is being vitalized. In Sunchang-gun, previous research findings show that the business support network of enterprises related to the 6th industry (small and medium-sized enterprises that produce traditional fermented food) was limited to research institutes or business support institutions (Lee, 2011). Nevertheless, a partnership with regional councils, including the Gochujang Village Farming Association, and other enterprises seems to develop gradually.
To develop the rural industries through the 6th industrialization, an important policy
task is how to change an early partnership. In Seocheon-gun at the beginning stage and Yeongdong-gun at the growth stage, the regions where the history of industrial clustering is relatively short and whose market shares are increasing, regional actors are cooperating with one another actively, and the actors are positive about the current structure of the regional 6th industry and its outlook.
On the other hand, in Sunchang-gun and Hadong-gun at the maturity stage, the regions whose major products markets are stagnant and whose market shares are difficult to be increased, residents were negative about the capacity of the regional 6th industry and its outlook. In Sunchang-gun, although expectations of creating innovation-based value added are not higher than those in the regions at the growth stage, partnership has developed. In this regard, the ecosystem of Sunchang-gun’s 6th industry was healthier compared to Hadong-gun.
It is necessary to differentiate support projects and policies by considering various regional conditions, including each region’s growth stage and clustering and growth levels of production activities of the 6th industry. Policies for the regional 6th industrialization are being implemented by classifying project stages into the network support project for the 6th industry and the 6th industry district project. Nonetheless, the policies have not been differentiated according to regional conditions such as the market environment and clustering and growth levels of the regional 6th industry.
For regions at the beginning and growth stages, it is needed to increase collective activities led by councils of companies and farms formed voluntarily or through policy support, and it is necessary to provide opportunities for many actors to participate in regional collective activities.
For regions whose market is stagnant or that are at the maturity stage of the 6th industry, it is required to create new value added by diversifying business, and implement support projects that encourage local actors’ continued collective activities.
Chapter 5 presented ways to promote the sustainable regional 6th industrialization by establishing a healthy ecosystem. The chapter examined major issues regarding the creation of a sound ecosystem and sustainable development, and sought the direction
of the regional 6th industrialization and feasible plans in the direction.
The following basic direction was set for the sustainable regional 6th industrialization based on the healthy ecosystem. First, policy support should be differentiated by considering each region’s growth stage. Second, to improve the regional innovation capacity, it is needed to lay the foundation continually and strengthen diverse support for it. Third, a stronger and efficient implementation system is necessary for the regional 6th industrialization.
As ways to promote the industrialization, first, differentiated support is necessary with consideration of the growth stage. It is needed to differentiate support by classifying development stages into beginning, growth, and maturity stages, and by dividing each stage into the establishment of the innovation base, R&D, a market, etc.
Second, it is necessary to continuously lay the foundation for enhancing regional innovation capacities and to strengthen support. For this, the basic process for establishing regional innovation infrastructure was emphasized, and strengthening knowledge-based infrastructure was stressed.
Third, it is required to create an efficient implementation system. To this end, it is needed to establish regional plans, and nurture key actors in city/county networks and intermediary support organizations that support building a market.
Researchers: Kim Sanghyo, Lee Yongsun, Heo Seongyoon E-mail address: skim@krei.re.kr