South Korea said Tuesday it will spend 380 billion won ($311 million) to support local exporters of agricultural goods amid fears the global spread of the new coronavirus will deal a heavy blow to sales this year.
"The spread of the COVID-19 virus has led to a slump in demand (for agricultural goods) from China, Hong Kong and Singapore," the Ministry of Agriculture, Food and Rural Affairs said in a statement.
The virus, which originated in the Chinese city of Wuhan, has killed more than 2,590 people and infected more than 77,000 in China, weighing on consumer sentiment in South Korea's largest trading partner.
To support local exporters, South Korea said it will allocate 368 billion won to loans for local agricultural exporters and cut their interest rates by 0.5 percentage point from the current 2.5-3 percent.
Another 12.3 billion won will be spent to support marketing projects for exporters both online and offline, up 35 percent from the original budget of 9.1 billion won allocated for this year.
South Korea will operate 17 shared logistics centers in China for South Korean exporters, compared with 15 last year.
The country said it will also make efforts to promote shipments of new products to Southeast Asia, including instant noodles, which have recently gained popularity overseas after appearing in the Oscar-winning South Korean film "Parasite."
The demand for products with health benefits is expected to increase via online platforms, it added.
Earlier this month, the ministry said this year's cumulative exports of fresh foodstuffs to China had decreased 26 percent on-year to $16.8 million as of the second week of February, apparently due to the spread of the virus. Outbound shipments of processed food to China fell 4 percent over the cited period to $61.8 million, it added.
South Korea is currently planning to expand its outbound shipments of agricultural goods by 6.7 percent to hit $7.5 billion in 2020.
In 2019, the value of agricultural goods exports reached $7 billion, compared with $6.9 billion a year earlier. Last year, South Korea's overall exports slipped 10.3 percent amid growing protectionism around the globe.
South Korea earlier projected a 3 percent rebound in its annual exports for 2020, but the latest epidemic has made the target less viable.