▲ This file photo, provided by the Ministry of Finance and Economy, shows its logo. (PHOTO NOT FOR SALE) (Yonhap)

By Kang Yoon-seung

SEOUL, July 31 (Yonhap) -- South Korea plans to launch a new sovereign wealth fund next year with the goal of making long-term investments in cutting-edge and strategic industries, the finance ministry said Friday.

The new fund, set to be launched with a budget of at least 20 trillion won (US$14 billion), will be established by opening a new account under the Korea Investment Corp. to utilize the global investment networks of the state-run company, according to the Ministry of Finance and Economy.

The fund will focus on long-term investments without a maturity.

State-run lenders, including the Korea Development Bank, the Export-Import Bank of Korea and the Industrial Bank of Korea, will inject 16 trillion won into the fund, while around 4 trillion won worth of shares accepted as payments of inheritance and gift taxes will also be contributed.

The fund will invest in projects based on the three principles of profitability, stability and public interest.

"Even if the investment period is long, the fund aims to invest in strategic industries with significant spillover effects and contribute to the country's growth potential," the finance ministry said.

The proceeds from such investments will be used only for reinvestment, government dividends and transfers to the national treasury.

The government aims to have the relevant bill passed by the National Assembly this year.

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