On March 11, Deputy Prime Minister and Minister of Finance and Economy Koo Yun Cheol chaired the Emergency Ministerial Meeting on Economic Affairs at the Government Complex-Seoul to discuss the “Government’s Joint Economic Response to the Situation in the Middle East,” the “Follow-up Measures to the Labor-Management-Government Joint Declaration on Retirement Pensions,” and the “Progress and Future Plans for the Basic Plan for Employment Stability in Response to Industrial Transition.”
Key messages from DPM Koo’s remarks are as follows:
[Government’s Joint Economic Response to the Situation in the Middle East]
As the situation in the Middle East has continued for 12 days, volatility in energy and financial markets has increased significantly. Against this backdrop, the government will mobilize all available policy tools, including a supplementary budget if necessary, to minimize the impact on people’s livelihoods and the broader economy.
▶ Actions to stabilize people’s livelihoods amid high oil prices
- Monitor future oil price trends and consider a fuel tax cut, while temporarily increasing diesel price-linked subsidies for freight trucks, buses and taxis.
- Actively support small businesses through measures such as management stabilization vouchers and emergency stabilization funds, while considering additional support measures as needed.
▶ Strict enforcement against crisis exploitation
- Implement a maximum price system for petroleum products within this week; finalize the fuel types covered and the price thresholds and, announce them shortly.
- Closely monitor market-disruptive activities, such as the spread of fake news and market manipulation exploiting financial market anxiety, and take strict action against any violations if detected.
▶ Swift and decisive response to any signs of economic instability
- Expand the existing market stabilization programs totaling over KRW 100 trillion if necessary, and implement additional market stabilization measures such as emergency buybacks and outright purchases of government bonds in close coordination with the Bank of Korea.
- Strengthen monitoring of supply conditions for items with high dependence on the Middle East and, if necessary, promptly designate them as economic security items; in particular, promptly prepare financial support measures to respond to potential disruptions in naphtha supply by securing alternative import sources and feedstocks.
Despite heightened external uncertainties, the Korean economy has solid fundamentals in key industries such as semiconductors and strong crisis response capacity, including oil reserves equivalent to 208 days of net imports under IEA standards.
[Follow-up Measures to the Labor-Management-Government Joint Declaration on Retirement Pensions]
As part of efforts to address structural challenges in the economy and enhance the foundation for future growth, the government will pursue policies to reinforce the social safety net for workers.
- Overhaul the retirement pension system for the first time in 20 years based on the Labor-Management-Government Joint Declaration (Feb.6, 2026).
- Finalize detailed measures for introducing a fund-type retirement pension system by July and push forward related legislative amendments within this year.
- Develop a plan to gradually make retirement pensions mandatory for all workplaces.
[Progress and Future Plans for the Basic Plan for Employment Stability in Response to Industrial Transition]
The government will establish the first Basic Plan for Employment Stability by June to prepare for rapid industrial transformation, including the rise of artificial intelligence (AI) and decarbonization.
- Provide education across the life cycle to ensure that all citizens can build AI capabilities, while significantly expanding employment support for emerging industries such as renewable energy.
- Provide proactive support for career planning and job transition consulting from the early stages of employment to prevent sudden employment shocks arising from industrial transition.
Please refer to the attached files.
