In the first half of 2024, the Korean economy has seen continued recovery with the drive to improve people’s livelihoods. However, due to disparities in the recovery pace across different sectors stemming from the accumulated high inflation and high interest rates, a range of sectors are still experiencing economic challenges. (For short-term) Stabilizing livelihoods in vulnerable sectors + Bringing economic recovery to areas that have felt less impact ⇒ Economic Policy Directions, H2 2024 (For long-term) Structural Reform → Strengthening the sustainability of the Korean economy ⇒ Dynamic Economy Roadmap [1. Support for small businesses] “Swiftly launch small business assistance program” ㅇ Alleviate the financial burden - Extend the repayment periods for policy funds and guaranteed loans, and support their conversion to low-interest loans - Reduce rental, electricity bills and labor costs ㅇ Enhance competitiveness - Support companies’ digitization and overseas market expansion ㅇ Support for a comeback - Expand the New Start Fund to 40 trillion won (+ 10 trillion won) ㅇ Expand Infrastructure - Establish comprehensive policy information platform “Inject 1 trillion won to urgent livelihood stabilization” ㅇ Provide subsidies for small businesses’ rent and electricity costs ㅇ Support living stability for workers with unpaid wages [2. Prices and living costs stabilization] “Inject 5.6 trillion won to curb inflation and reduce the living expenses” ㅇ Minimize the increase in public utility fees ㅇ Reduce core living costs - Expand support for catastrophic healthcare expenditure, including non-covered out-of-pocket expenses - Extend tax incentives for landlords who have raised monthly rentals by less than 5% until the end of 2026 ㅇ Support for stabilizing the lives of SME workers and the unemployed - Ease requirements for SME employees to receive a 70-90% income tax reduction [3. Domestic market and construction sector reinforcement] ㅇ Expand public sector investments and loans by 15 trillion won ㅇ Ensure the passage of bills on boosting the domestic market ㅇ Expand youth start-up hubs utilizing idle and outdated public buildings ㅇ Promote eco-friendly vehicle consumption - Expand subsidies to electric vehicles * Eligible vehicles: Passenger cars + cargo vehicles - Extend the application period for special individual consumption tax exemption [4. Potential risks management] ㅇ Stabilize the real estate project financing (PF) market - Devise an institutional reform of real estate PF including restructuring of PF business structure ㅇ Stably manage household debt - Maintain household debt-to-GDP at the low 90% level ㅇ Establish economic monitoring system - Examine real economy trends by using big data and AI models The Korean government’s forecast for 2024 economic growth saw an upward revision (2.2% → 2.6%) The government will remain vigilant and exert all efforts to boost the economic recovery to make sure that people can actually feel its impact.