5th Emergency Economic Council Meeting
Government to Support Job Retention
With job markets worsening amid weak manufacturing and social distancing, the government decided to provide further support to help businesses retain jobs at the 5th Emergency Economic Council Meeting held on April 22. The support contains 1) wage subsidies for small businesses and enterprises, and programs for the unemployed, and 2) liquidity injection for cash-strapped companies.
1) Wage subsidies and programs for the unemployed: 10.1 trillion won for 2.86 million persons
- Wage subsidies for small businesses and enterprises: 0.9 trillion won for 520,000 employees
- Emergency relief for those outside the unemployment insurance: 1.9 trillion won for 1,130,000 unemployed
- Create jobs for low income groups and young adults: 3.6 trillion won for 550,000 job seekers
- Job seeker benefits and job training programs: 3.7 trillion won for 660,000 job seekers
Out of the 10.1 trillion won, 0.8 trillion won will be spent immediately using government funds, and the rest 9.3 trillion won will have to get an approval from the National Assembly.
2) Liquidity injection for cash-strapped companies: Over 75 trillion won to be added to the over 100 trillion won package announced at the 2nd emergency economic council meeting
- A total of 35 trillion won to be added to the support for businesses hit hard: Support for small businesses and enterprises (up 10 trillion won), purchases of low-rated corporate bonds, CPs and short-term corporate debt (up 20 trillion won), and P-CBO support (up 5 trillion won)
- A total of 40 trillion won for cash-strapped key industries
To finance the support, the government will have submitted to the National Assembly revisions to the Korea Development Bank Act by April 24 and the agreement on government guarantee of fund bonds by April 28.
The new Central Economic Response Headquarters to take over the Emergency Economic Council Meeting discussion.
The new Central Economic Response Headquarters will be kicked off next week, taking over the discussion of the Emergency Economic Council Meeting and replacing the Crisis Management Meeting. Deputy Prime Minister Hong Nam-ki is going to lead the headquarters, composed of three divisions for financial market risks, industrial risks and job markets, which will be led by Ministers in charge of the divisions.
Please refer to the attached pdf