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Moon calls on government to focus on reducing economic impact of virus

Finance Ministry reveals plans to support budget airlines

President Moon Jae-in speaks at the briefing session by economy-related government organizations at Cheong Wa Dae in Seoul on Monday. Yonhap
President Moon Jae-in speaks at the briefing session by economy-related government organizations at Cheong Wa Dae in Seoul on Monday. Yonhap

President Moon Jae-in on Monday called for close cooperation among economy-related government bodies in reviving the economy and dealing with the effects of the coronavirus outbreak.

“Economic ministries have the important task for realizing clear changes in people’s livelihoods and the economy. (Their) shoulders have become heavier due to the COVID-19 situation,” Moon said at the annual operations briefing by economy-related government organizations.

The bodies that held the briefing session are the Ministry of Economy and Finance, Ministry of Trade, Industry and Energy, Ministry of SMEs and Startups and Financial Services Commission.

Describing the response to Japan’s trade-curbing measures as “the most meaningful” work of economy-related ministries last year, Moon urged concerned ministries to work together to minimize the impact of the outbreak.

“The economic damage from COVID-19 is being felt more clearly that the MERS situation of 2015. If the slowdown becomes prolonged, it will have a big impact on not only the economy, but on the people’s livelihoods. It is an extraordinary and grave situation,” Moon said.

Saying that the domestic market has been affected by “overinflated fears” of the outbreak, Moon asserted the government must now concentrate on reviving the economy, and urged the public to resume economic activities as usual.

At the briefing session, the Finance Ministry focused on the plans for “innovative growth” and the economic impact the COVID-19 outbreak is having on the country’s economy.

With regards to innovative economic growth, the ministry said it plans to establish a systematic means to support concerned industries.

On COVID-19 related plans, the ministry said it will closely monitor the industries to draw up measures tailored to different industries.

The main topics of the Industry Ministry’s briefing were furthering independence from Japan with regards to key industrial parts and materials and aiding development in new areas such as eco-friendly automobile technologies. The ministry also revealed plans to boost the Moon administration’s drive to lay the foundations for a hydrogen economy, including setting up 100 hydrogen recharging stations and lowering its wholesale price.

The SME Ministry’s plans include aiding startups in selected industries such as system semiconductors, bio-health and artificial intelligence.

Earlier in the day, the Economy Ministry also revealed plans to inject a maximum 300 billion won ($254 million) into low-cost carriers that bore a direct hit from the spread of the COVID-19 virus and its dampening impact on the travel industry.

“(The government) will establish an emergency loan program for low-cost carriers within the ceiling of 300 billion won,” said Deputy Prime Minister and Finance Minister Hong Nam-ki, who was chairing a meeting of economy-related ministers at Seoul Government Complex.

For airline operators that have suspended or reduced flights, the government will offer a maximum grace period of three months on the payment of airport charges, he added.

As some 1,770 people have died in China from the new coronavirus and Asia’s fourth-largest economy has reported 30 confirmed cases so far -- with nine patients fully recovered -- 80 percent or more of the conventional flights between Korea and China have been either halted or cut.

The county’s six low-cost carriers, which already faced record-high business losses last year amid Japan’s exports curbs and disputed flaws in the Boeing 737 model, suffered 300 billion won in damage over the past three weeks due to surging flight cancellations and consequent refunds.

“As the key interstate transportation route, the aviation industry always takes the most direct impact from cross-border epidemics,” said Land Minister Kim Hyun-mee.

“In our latest set of measures, (the government) has sought to inject emergency funds into the affected businesses and to speed up the recovery pace of flight demands.”

By Choi He-suk and Bae Hyun-jung
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