[Editorial] The Service Industry Development Act Has Been Stalled for 15 Years. It Is Time to Pass It.

There is no longer room to delay discussions on how to develop the service sector into a new pillar of national growth alongside manufacturing. It is highly significant that Deputy Prime Minister Koo, business groups, and relevant ministries met on the 6th to discuss ways to strengthen the competitiveness of the service industry and stressed the need to enact the Framework Act on Service Industry Development. Presiding over the meeting, Koo said, "We now need to redraw the board for the development of the service industry." Ryu Jin, chairman of FKI, said, "Advancing the service industry is a key task for opening the era of the New K-Industry." FKI also proposed 20 measures to the government, including legislation for the service industry development act, expanded financial support for K-content, and regulatory reform for contactless delivery services. The government and the political community must follow up so that the discussions do not end as words alone, but lead to real change.
The Korean economy is heavily tilted toward semiconductors and manufacturing, and the resulting polarization has become a serious problem. The semiconductor industry is booming, while other sectors are in the cold. As cheap Chinese products flood the market and the U.S.-China power struggle intensifies, Korean manufacturing is losing its footing and facing growing uncertainty. To reduce risks to the economy and lay the groundwork for the next leap forward, high-value-added service industries such as content, tourism, healthcare, logistics, beauty, and AI-based services must be developed as national strategic industries.
The service sector accounts for a very large share of employment and value added. According to FKI, it represents 70% of domestic employment and 60% of value added. Yet low productivity and weak export competitiveness remain chronic problems. For a long time, it has been viewed mainly as a supporting industry for manufacturing, and support for R&D, taxation, finance, and workforce training has not been provided in a systematic way. Now, as K-content, beauty, and medical tourism target global markets and the AI revolution reshapes the industrial landscape, upgrading the service sector is more urgent than ever. Future value will be created not only in products, but increasingly in data, platforms, design, distribution, and intellectual property.
The Framework Act on Service Industry Development is the minimum starting point for this effort. However, the bill has remained stalled for 15 years since it was first introduced during the Lee Myung-bak administration. The main reason for the delay has been conflict over deregulation in the medical sector. Controversies over for-profit medical corporations, medical privatization, telemedicine, and attracting foreign patients have held the bill back. Concerns about undermining the public nature of healthcare should not be dismissed lightly. The national health insurance system and essential medical services must not be weakened, and excessive treatment and medical polarization must also be prevented. But these concerns should not be allowed to block the overall growth of the medical service industry.
Medical services are high-value-added services that extend beyond treatment revenue into lodging, tourism, shopping, beauty, interpretation, insurance, and platform industries. Attracting foreign patients and promoting medical tourism can also help stimulate domestic demand and support regional economies. These efforts should be pursued step by step, as long as they do not damage public healthcare or the national health insurance system. More importantly, the policy should not stop at simple deregulation. A pan-government control tower should be established, and the plan should comprehensively include service-sector R&D, workforce training, broad tax and financial support, overseas expansion, and intellectual property protection. In the medical, tourism, and beauty industries, an integrated strategy to attract foreign consumers will also be needed. Through this, the service sector can leap forward as an export industry alongside semiconductors.
The National Assembly should waste no more time. It must stop repeating outdated arguments and move quickly to legislate. Only by becoming a powerhouse in services as well as manufacturing can the Korean economy overcome the wall of low growth.