The global environment surrounding industrial policy is undergoing a profound transformation. The intensifying U.S.–China technological rivalry, persistent disruptions in global supply chains, the accelerating transition toward carbon neutrality and ESG regulations, and the rapid emergence of AI and other convergent technologies are reshaping the industrial policy landscape worldwide. Industrial policy today is no longer confined to promoting specific sectors or supporting R&D; it has become a key instrument of technological sovereignty, economic security, and sustainable growth.

In this context, the effectiveness of industrial policy depends not only on what policies are pursued but increasingly on how they are coordinated, implemented, and evaluated. The quality of governance ─ its ability to align multiple actors, ensure coherence across ministries, and create a consistent feedback mechanism ─ has become the decisive factor that determines the success or failure of industrial policy.

This report examines the structural challenges facing Korea’s industrial policy governance and explores directions for its reform in light of global changes. It diagnoses the fragmented institutional system in which ministries operate independently, the lack of horizontal coordination across government levels, and the limited participation of private actors. It also highlights the instability of the legal and fiscal foundations that undermine the continuity and predictability of industrial policy.

To address these problems, the study proposes the establishment of an integrated industrial policy governance system capable of linking planning, implementation, evaluation, and feedback into a coherent policy cycle. Drawing on comparative analyses of major countries (the United States, Japan, the EU, Germany, and China) and expert surveys conducted with 50 Korean policy specialists, the report presents three alternative models for reform: a presidential-level control tower, a prime ministerial coordination model, and a strengthened Ministry of Industry–based model. 

The findings emphasize that improving governance is not a matter of administrative adjustment but a prerequisite for ensuring the sustainability and effectiveness of Korea’s industrial strategy. Ultimately, the redesign of industrial policy governance is essential for building a government- wide system capable of responding swiftly and strategically to global technological shifts, supply chain disruptions, and the challenges of the green and digital transitions.