[NOTEBOOK]IT, biotech can lead the way

We can call the Korean economy a “cellular economy.” When asked what contributes the most to the economy these days, Koreans will cite the information technology industry, especially mobile phones, without hesitation. In English-speaking countries, mobile phones are referred to as “cellular phones,” as the communication service zones are divided and networked like cells.
Among the Organization for Economic Cooperation and Development member countries, Korea is No. 1 in terms of the IT industry’s contribution to the national economy. It made up 34 percent of exports in 2002 and 16 percent of the gross domestic product in 2004.
Korea controls 42 percent of the world’s DRAM semiconductor market, 30 percent of the TFT-LCD market and 25 percent of the mobile phones. These products are formidable growth engines that help expand the IT industry here by 20 percent every year.
In the case of Samsung Electro-nics, half of the 12,000 employees in the information communication sector are researchers, who design more than 100 new mobile phone models a year. When you take into account the other mobile phone producers in Korea, such as LG Telecom and Pantech, a new handset is introduced every day in the nation.
So what will support the Korean economy in the future? The first thing that comes to mind is the stem cell research of Professor Hwang Woo-suk, and many people will think of the biotech industry.
According to the Korea Institute for Industrial Economics and Trade, the size of the global biotech market is currently $54 billion and expected to grow to $154 billion by 2010.
The field of regenerative medicine for bones and joints, which is currently a $15 billion market, is expected to grow by 30 percent a year, the fastest in the field. The biggest reason for the rapid growth is the surge in demand from the aging sector of the society, while the number of donors is likely to decrease. By 2020, Korea will become a super-aged society, and some forecast that nearly half of the national budget will be spent on health care and senior welfare.
After all, the today and tomorrow of the Korean economy are in the hands of the “cellular economy,” so it is time to draft a detailed strategy to keep the IT and biotech industries running as growth engines and have them contribute to use and accumulate social assets efficiently.
The most important task is to resolve the human resources problem. Every year, among the science and engineering master’s and doctorate degree graduates, 12 percent have a degree in biotechnology and 27 percent have an IT-related degree. If we compare the amounts of research and development investment in each sector, which is a measure of the industrial application of human resources, biotech makes up only 3 percent of the total, while information technology takes up 55 percent.
In other words, biotech majors cannot find jobs while the IT industry suffers from a manpower shortage. Colleges and universities are restructuring the system just in time, and businesses are searching for new lucrative industries. It might be a good chance to review the problems in the supply and demand of human resources.
In the biotech industry, there must be a system to link scientists and engineers so that research results can be swiftly applied for commercial use. There has been criticism that researchers are too attached to publishing their work in prestigious academic journals such as Nature and Science.
The role of the government is more important than ever. More than 30 percent of the Kosdaq-listed companies are venture companies, mostly in the IT field, generating more than 5 billion won in revenue. The average number of employees is 40, and the sector’s stability makes the return of a bursting IT bubble a remote possibility. Instead, we have to be vigilant of the biotech industry, which is enjoying the stem-cell research boom.
When the Ministries of Science and Technology; Commerce, Industry and Energy; and Information and Communication, which are in charge of research and development and industries, plan next year’s science and technology-related budget, they should make sure the budget contains a national strategy for research and development and for the technology industries, with a special consideration for private sectors.

* The writer is the deputy director of the JoongAng Ilbo Economic Research Institute.

by Kwak Jae-won