South Korea said Thursday it will inject 1.25 trillion won ($1 billion) to help cash-strapped shipping firms hurt by the global new coronavirus pandemic, which has been disrupting business activities and trade of goods.
"The shipping firms are expected to suffer more serious damage after the second quarter, considering the time lapse between the global economic turmoil and the decline in their performances," Oceans Minister Moon Seong-hyeok said.
"Thus, South Korea plans to provide the firms with more liquidity in advance."
Under the plan, South Korea will inject 100 billion won and ease ships' loan-to-value ratio to as high as 95 percent, compared with the current rate set between 60 and 80 percent.
The Korea Development Bank and the Korea Ocean Business Corp. will also spend 470 billion won to repay maturing debts of Hyundai Merchant Marine Co. (HMM), South Korea's largest shipper.
The World Trade Organization (WTO) expects the combined size of global trade to decrease 32 percent on-year amid the COVID-19 pandemic, casting dark clouds over shipping firms. (Yonhap)