215th Ministerial Meeting on International Economic Affairs
Government to Promote Overseas Construction
Deputy Prime Minister Hong Nam-ki presided over the 215th Ministerial Meeting on International Economic Affairs held on June 15, and discussed plans to promote overseas construction and expand COVID-19 cooperation. Participants reviewed the KIEP[1] report on global economic changes and suggested responses.
The following is a summary of Deputy Prime Minister Hong’s keynote address:
Korea’s exports have been hit hard by the COVID-19 pandemic, the country’s major exports dropping, such as automobiles, auto parts and petroleum products. However, contraction slowed in June and consumer product exports are going well, such as medicines and wireless communications devices. The government will announce another round of export-boosting measures by July, as well as measures to promote overseas construction and reshoring support.
As significant changes are expected in the global economy and industrial structure after the COVID-19 pandemic, we have to work hard to enhance export competitiveness and prepare for a possible change in the global supply chain (GVC). The government will announce in July plans for a post COVID-19 economy and new GVC, and in November post COVID-19 international economic policies.
Topics of discussion
1) KIEP’s analysis on global economic changes and suggested responses
In its analysis on global economic changes and suggestions on how to best prepare for them, KIEP proposed making ready for the new GVC order, participating in the OECD discussion of digital tax and joining the Digital Economy Partnership Agreement (DEPA).
2) Plans to promote overseas construction
The government will provide over 15 trillion won worth of support to promote Korean companies’ participating in large-scale overseas projects.
- Select 30 large-scale construction projects overseas and help Korean companies participate in those projects
- Provide a total of 3.7 trillion won worth of financial support to help receive orders: 1.5 trillion won worth of new funds for global construction, 0.4 trillion won worth of investment by the global infrastructure funds, and 1.8 trillion won financial support by Korea Exim bank and Korea Trade Insurance Corporation
- Provide partner countries with consulting services, such as through the Economic Innovation Partnership Program, a new KSP model, to help those countries plan new projects, including smart city projects
- Provide 10.9 trillion won worth of loans and guarantees to promote participating in new projects
3) Plans to expand COVID-19 cooperation
- Provide US $100 million worth of humanitarian aid, EDCF emergency support worth over US $400 million, MDB trust funds worth US $10 million
- Create 1.2 trillion won worth of funds[2] to support the export of healthcare goods and services
- Share the K-quarantine tools and experience with the global community, and seek the K COVID-19 response model composed of 18 sets in three categories of test, trace and treat to be recognized as a global model
- Provide a disease control package for countries selected, in particular New South countries and New North countries, to strengthen cooperation
4) Korea-Cambodia FTA negotiations
- Korea-Cambodia FTA first discussed in March last year under the administration’s New South framework
- Joint study and public hearings on the FTA finalized, the government will begin the FTA negotiations in July
Please refer to the attached pdf
