À̹ÌÁö È®´ë The South Korean government will prepare another coronavirus relief package worth total 53.7 trillion won ($43.9 billion) aimed to bolster exports and domestic demand amid growing fears that the pandemic-driven economic fallout could be worse than during the previous financial crashes.
During the fourth emergency economic council session held at Cheong Wa Dae on Wednesday, President Moon Jae-in vowed the government will provide 36 trillion won in trade finance for domestic exporters and 17.7 trillion won to promote domestic consumption, saying that the previous relief measures are not yet enough to weather the fallout of the COVID-19 pandemic on the economy.
The latest stimulus package is an addition to the government¡¯s emergency financial aid package of 100 trillion won to help COVID-19 affected companies stay in business and stabilize the financial market, as well as emergency cash allowances to more than 14 million low- and middle-income households.
The new relief package focuses on promoting domestic consumption and supporting export-oriented companies hit hard by the collapse of global supply chains, as well as startups and ventures with a credit crunch amid the pandemic.
Moon said the government decided to inject an additional 36 trillion won into supporting local exporters` credit and capital liquidity to ensure no business misses an opportunity to export due to liquidity problems.
À̹ÌÁö È®´ë According to the Ministry of Trade, Industry and Energy last week, Korea¡¯s exports in March totaled $46.91 billion, down 0.2 percent from the same month a year ago. The March result was better than expected with the limited coronavirus impact, but exports are likely to suffer in the coming months as the pandemic has only begun to wreak havoc on U.S. and European business activities and global demand.
Last week, Finance Minister Hong Nam-ki pledged bigger support for exporting companies, acknowledging that exporters are ¡°the backbone of Korea¡¯s economy.¡±
The government will also provide 17.7 trillion won of funds to stimulate "rapidly frozen domestic demand." Moon said additional aid totaling 17.7 trillion won will be poured to revive domestic consumption, including more than 3.3 trillion won to be spent as part of the public sector`s participation in the so-called "pre-settlement¡± and ¡°in-advance purchasing" campaign.
The government also unveiled a package of measures worth 12 trillion won in various tax breaks for small business owners hit by the virus outbreak.
Regarding the start-up and venture investment support, the government will provide additional funding at a low interest rate and approximately 2.2 trillion won by offering bold incentives for private venture investment in the private sector with a new special loan guarantee program, Moon said, stressing the need of bold and aggressive financial inputs to overcome the crisis.
By Park Yong-beom and Minu Kim
[¨Ï Pulse by Maeil Business Newspaper & mk.co.kr, All rights reserved]