'80% Cancellation of Accommodation Reservations and Sharp Decline in Transport Volume'... YeoGyeongHyeop Supports 'COVID-19' Damage Assistance

[Asia Economy Reporter Kim Daeseop] #Shipping and container transport company A accounts for more than 90% of import and export volumes between Korea-China and Korea-Japan. Due to the novel coronavirus infection (COVID-19), the transport volume did not even reach 20% compared to the previous year. Fixed costs such as labor expenses continue, accelerating the damage. Despite workers taking alternate day leave, the expected damage amount continues to increase, making urgent financial support necessary.

According to the Korea Women Entrepreneurs Association on the 27th, as a result of receiving damage cases caused by the outbreak of COVID-19, they are currently continuing management support consultations related to damages for a total of 45 companies. Applications were received from 2,584 member companies from the 14th to the 18th of this month.

Accommodation company B, with annual sales around 3 billion KRW, suffered over 80% reservation cancellations from December last year to April this year. The damage amount exceeds 500 million KRW. Auto parts specialist company C is also facing management difficulties. Due to the closure of the first-tier partner's local factory in China, production and delivery have become impossible in a chain reaction. The accumulated inventory and uncollected damages due to the prolonged COVID-19 amount to 30% of last year's sales.

Since the 17th, the Women Entrepreneurs Association has set up a 'COVID-19' hotline to continuously receive damage cases. Through the 'Women Entrepreneurs Desk Specialist' within the Women Entrepreneurs Comprehensive Support Center, they are guiding applications for government support projects such as management stabilization funds.

In particular, although the association is guiding affected companies on applying for corporate stabilization funds, employment retention subsidies, tax reductions, and repayment deferrals, there appear to be many practical obstacles and difficulties in receiving actual support.

Most affected companies require emergency operating funds of around 200 million KRW. However, the amount of funds allocated to each institution and financial institution is very small, and many cases have already been exhausted or have an explosive number of loan applications compared to the fund size, resulting in many having to wait indefinitely.

A representative of the Korea Women Entrepreneurs Association said, "Since the majority of women-owned businesses are small to medium-sized service industries, rapid supplementary budgeting is necessary to provide practical support for the management difficulties of women-owned businesses directly hit by COVID-19," and added, "In cases where the economic ripple effect is large at a national disaster level like COVID-19, support should be provided so that companies can overcome the crisis with peace of mind through exceptions to financial institution risk asset regulations."

This content was produced with the assistance of AI translation services.