Government Doubles Financial Support to Tourism Industry Facing Crisis

Due to the impact of the novel coronavirus infection (COVID-19), foreign tourists have decreased, putting the tourism industry at risk of collapse. Amid this situation, a hotel in Seoul posted a closure notice and locked its doors. Photo by Jinhyung Kang aymsdream@

[Asia Economy Reporter Kim Heung-soon] The government will double the financial support scale from 150 billion won to 300 billion won for the domestic tourism industry, which is facing a crisis due to the spread of the novel coronavirus infection (COVID-19).

The Ministry of Culture, Sports and Tourism announced on the 19th that it will expand the emergency financial support (Tourism Promotion Development Fund loans) for the tourism industry, which has been implemented since mid-February, from the original 150 billion won to 300 billion won.

The special credit-guaranteed loans, which provide up to 200 million won through credit guarantees for tourism businesses with weak collateral, will increase from the original 50 billion won to 100 billion won. The one-year repayment deferral scale for existing Tourism Promotion Development Fund loans will also be raised from 100 billion won to 200 billion won. The total support amount combining these measures is 300 billion won.

According to the Ministry of Culture, Sports and Tourism, as of the 13th, a total of 795 companies applied for special credit-guaranteed loans, amounting to about 46.4 billion won. Travel agencies accounted for 80% (640 companies) of the total applications and 76% (about 35.4 billion won) of the application amount.

Demand for repayment deferral of existing loan funds was also high, with a total of 326 companies applying for about 83.2 billion won as of the 13th. So far, repayment deferral has been approved for about 56.1 billion won for 277 companies. The hotel industry had the largest scale with 193 companies and 46.8 billion won.

The Ministry of Culture, Sports and Tourism is cooperating with related institutions such as the Credit Guarantee Foundation and NongHyup Bank, reinforcing personnel related to credit guarantee applications and processing, and expanding credit guarantee reception counters at NongHyup Bank branches. The approval of credit guarantees and supply of loan funds, previously conducted once a week, have been expanded to twice a week.

A Ministry of Culture, Sports and Tourism official said, "We hope that financial support will reach more businesses and help them endure the difficulties caused by COVID-19," adding, "We will continue to monitor to ensure that necessary funds are promptly supplied to struggling industries in the future."

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