2nd Ministerial Meeting on Boosting the Economy in 2020
3rd Ministerial Meeting on the Economy in 2020
Government to End Hoarding of Hygiene Products
Deputy Prime Minister Hong Nam-ki presided over the 3rd Ministerial Meeting on the Economy held on February 5 and discussed the support for businesses affected by the spread of the novel coronavirus. At the following 2nd Ministerial Meeting on Boosting the Economy, action plans for the 10 deregulation tasks were discussed, as well as ways to promote coastal vessel financing. DPM Hong also talked about the new regulations against the hoarding of hygiene products used to protect from the virus at the beginning of the meeting.
The following is a summary of Deputy Prime Minister Hong’s keynote address.
The government announced the banning of hoarding protective masks and hand sanitizers on January 5: Sellers with more than 150 percent of last year’s average monthly sales for more than five days will be subjected to penalties of less than 50 million won, or up to two years in prison. Overseas shipments of more than 1,000 units of each of those products, or worth more than 2 million won, will be required to go through regular export procedures, instead of the simple ones currently required.
Tax and customs support for businesses affected by the disease
The government will provide the following support to businesses and manufacturers affected.
- Give an income tax extension for up to nine months and VAT extension for the same period to businesses in tourism, including accommodations and dining services
- Work on early tax returns and for underpayment, give up to one year before penalties
- Discontinue, or suspend the tax audits being carried out
- Run a 24 hour customs clearance service for parts and supplies imports from countries other than China, streamline the import procedure, and give customs extension and early return
The government will work on action plans to support tourism and the auto industry, as well as small merchants and exporters. We will work towards the complete control of the disease with no death toll, the economy affected as little as possible and the recovery momentum not lost.
Plans for 10 deregulation tasks
The government has drafted a list for its 10 deregulation tasks, which include regulations in data, AI and healthcare, as well as tech startup regulations. We will finalize the list this week, and then will launch a taskforce next week to carry out a zero-based review of the regulations. The roadmap for the 10 deregulation tasks is to be drawn up in March, according to which the government will work on action plans.
Coastal vessel financing
The government will finance replacement of old coastal vessels with new ones through the Industrial Bank of Korea and Korea Ocean Business Corporation, which will work to lower the risk of the ship financing by investing in 20 percent of the subordinated debt and providing guarantees for more than 95 percent of the senior debt. The government will work to attract a total of 800 billion won of private sector financing, which will be used to provide ship financing in the long-term (16 years).
We will visit Mokpo after this meeting, a southern coastal city of the country and have talks with representatives of small- and medium-sized shipbuilders and shippers.
Please refer to the attached pdf