Seoul announces stimulus package to combat economic impact of virus

South Korea on Friday said arrangement had been concluded to cushion the consequences of the coronavirus for Asia’s fourth largest economy with an economic stimulus package.

Finance Minister Hong Ki, said measures worth in excess of 20 trillion won (or 16.5 billion dollars), though he did not give an exact figure.

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The spokeswoman for the Finance Ministry, the amount include: an already planned budget supplement that will be introduced in parliament shortly.

According to the draft, it would far exceed the 6.2-trillion-won budget that South Korea allocated during the outbreak of the respiratory disease MERS five years ago.

Ki said it was hoped that the measures would help limit the extent of damage caused by the spread of the coronavirus and strengthen economic momentum.

Economic activity and confidence have been hit hard by the coronavirus outbreak in South Korea, which has reported the highest number of cases of the disease outside China.

On Friday, the number of those infected had risen to more than 2,300.

However, among other things, aid of 9 trillion won was now being provided by financial institutions for companies suffering losses in turnover due to the outbreak.

Low-interest loans for small and medium-sized companies are also being made available.
The government also planned to distribute shopping vouchers for private households to stimulate demand.

Earlier, the governor of South Korea’s Central Bank, Lee Yeol, warned that the country’s economy could shrink in the first quarter.

The Bank of Korea has corrected its growth forecast for 2020 from 2.3 to 2.1 per cent.
The bank said among other things, private consumption is expected to collapse in the short term due to the Covid-19 outbreak.

(dpa/NAN)