The rapid spread of the novel coronavirus is expected to weigh on South Korea's economy unless the epidemic is contained swiftly, Finance Minister Hong Nam-ki said Monday.
The coronavirus epidemic has had a limited impact on the Korean economy so far, but it is difficult to determine how the virus will affect the nation's economy, Hong told a meeting with economy-related ministers earlier in the day.
"There is a high possibility that this situation could slow China's economy," Hong said. "In this case, it will have a negative impact on the global economy."
The government will spare no efforts to minimize the economic fallout from the virus, Hong said.
Hong said the government will swiftly take action to stabilize financial markets if volatility grows amid the spread of the virus.
The government will take "preemptive and swift" measures if volatility in financial markets increase, Hong said.
Hong also issued a warning against price-rigging of face masks, saying the government will punish those who engage in price-rigging as demand for face masks surges.
South Korea has 15 confirmed cases of the virus, believed to have originated in the Chinese central city of Wuhan. The virus has killed more than 360 people in China's Hubei province, where Wuhan is the capital city.
Starting Tuesday, South Korea will temporarily ban foreigners who have visited Hubei within 14 days from entering the nation.
South Korea's exports fell at a slower-than-expected pace in January but extended the slump to a 14th-consecutive month due to fewer working days and still weak demand for chips.
Outbound shipments came to $43.35 billion last month, down 6.1 percent from $46.17 billion a year earlier, according to the data compiled by the Ministry of Trade, Industry and Energy.
But when measured by working days, exports increased 4.8 percent in January to reach $2 billion a day, marking the first on-year increase in 14 months, according to the ministry.
Concerns are growing about the economic fallout from the coronavirus outbreak in China at a time when Korea's economy is struggling to regain its recovery momentum.
Hong told reporters that the government has not been considering drafting a supplementary budget, but it is closely monitoring how the virus will affect both exports and local consumption.
"China is closely related to our economy and the global economy. So, the government is reviewing economic impacts (of the virus outbreak) on both exports and consumption," Hong said.
The government will announce new measures to support exports by the end of this month, Hong said.
The 2003 SARS outbreak cut Korea's annual economic growth by 0.1 percentage point and the 2015 MERS outbreak reduced the nation's annual economic growth by 0.3 percentage point, Hong said.
"The government will take all-out measures to maintain the momentum of an economic recovery while trying to minimize economic impacts from the new coronavirus," Hong said.
Hong warned against "speculative" currency trading, saying that the government will take firm stabilization measures if such transactions are detected.
As the number of foreign tourists plunged, the government is likely to draw up new measures to support local tourism, food and accomodation sectors, Hong said. (Yonhap)