Vice Minister Ki Jae: "The COVID Unemployment Shock Is Just Beginning... Full Effort on Job Support"

"Q2 Economic Bottom Outlook"

[Image source=Yonhap News]

[Asia Economy Reporter Jang Sehee] Kim Yong-beom, First Vice Minister of the Ministry of Economy and Finance, said regarding the novel coronavirus infection (COVID-19), "Most experts expect the second quarter to be the bottom, so the full-scale impact such as real economy recession or unemployment is just beginning."

On the morning of the 4th, Vice Minister Kim chaired the Macroeconomic and Financial Meeting at the Seoul Banking Hall and said, "Considering the risk factors that could amplify volatility in the global real economy and financial markets, we cannot afford to lower our guard."

He stated, "I would like to once again emphasize that the core of overcoming the national crisis is jobs, and we will make every effort to support job preservation." He added, "We will also accelerate the creation of new jobs by discovering Korean New Deal projects."

Regarding the Korean New Deal, he explained, "We will discover large-scale digital-based information and communication technology (IT) projects and actively plan and promote various projects in fields gaining attention due to the COVID-19 situation, such as non-face-to-face medical services and online education services."

Vice Minister Kim emphasized the need to closely monitor international oil price movements and the situation in emerging countries.

Regarding international oil price movements, he said, "Unless concerns such as the shortage of low-oil storage space are fundamentally resolved, international oil prices are expected to exhibit high volatility for the time being." He forecasted, "As oil-producing countries' growth forecasts are significantly downgraded and current account and fiscal deficits are expected to worsen, the possibility of oil money withdrawal in financial markets could act as a disruptive factor for the global economy."

He added, "There is concern about instability in the high-yield bond market led by U.S. energy companies, and the decline in oil prices could act as a risk factor in international financial markets, so special attention is required."

He also said, "Most emerging countries are helpless against the spread of infectious diseases due to underdeveloped healthcare systems and are experiencing rapid capital outflows, sharp currency depreciation, and decreases in foreign exchange reserves, resulting in unstable financial markets, but their policy response capacity is very limited."

Finally, he said, "There are signs that the conflict between the U.S. and China over the responsibility for the spread of infectious diseases is reemerging as a trade conflict. We must be fully prepared to respond promptly in case of emergencies."

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