1st Crisis Management Meeting of 2020
11th Ministerial Meeting to Respond to COVID-19 Outbreak
Government Steps up Pandemic Response Efforts
Deputy Prime Minister Hong Nam-ki presided over the 1st Crisis Management Meeting of 2020, a ministerial gathering to respond to the COVID-19 outbreak. The crisis management meeting will be held regularly replacing the Ministerial Meeting on the Economy and the Ministerial Meeting on Boosting the Economy. Support for small businesses and industries hit hard by the disease outbreak were main topics of discussion. DPM Hong talked about measures to help maintain FX market stability at the beginning of the meeting.
The following is a summary of Deputy Prime Minister Hong’s keynote address.
2020 supplementary budget passed
The 2020 supplementary budget worth 11.7 trillion won (10.9 trillion won for new spending and 0.8 trillion won for revenue adjustment) was passed on March 17.
- 2.1 trillion won to be spent on disease prevention and treatment
- 4.1 trillion won to be spent on small business loans
- 3.5 trillion won to be spent on household support, including daycare vouchers and emergency livelihood support
- 1.2 trillion won to be spent on the local economies hit hard
Raise forex futures trading limits
Although Korean banks have maintained a relatively high level of FX liquidity, we should be prepared for a sudden volatility in the FX swap market as it becomes volatile recently. The government has decided to raise the forex futures trading limit by 25 percent, making it 50 percent for local banks and 250 percent for foreign bank branches. The new limit will be applied from March 19.
We will make ready other contingency plans, such as bond market stabilization funds and P-CBO support programs, closely watching how local and global financial markets develop.
Topics of discussion
We will discuss the following at today’s meeting.
1) Ways to efficiently deliver the small merchant and SME support, including the emergency support for business operation
2) 2nd emergency package for industries
- Airliners, public buses and maritime transport: Fee cuts for using airports, express ways and passenger terminals, reduced public bus schedules and emergency support for passenger ships traveling between Korea and Japan
- Tourism and art performance: Emergency loans for tourism, and production costs support and admission fee support for art performance
- Exports: Guarantees for accounts receivable financing and activities to promote online exports
3) Disclaimer with regard to implementing COVID-19 response measures
- Emergency financing for low cost carriers by state-owned financial institutions
- Emergency financing for small businesses and emergency support for households by state-owned financial institutions and government agencies, such as Korea SMEs and Startups Agency
- Activities Public Procurement Service are involved in to meet mask demand
Please refer to the attached pdf