Government to Announce New Deal Fund Soon... "No Guarantee of Fixed Returns"

'Briefing on the Results of the 2nd Korean New Deal Ministerial Meeting and the 14th Emergency Economic Central Countermeasures Headquarters Meeting'

[Image source=Yonhap News]

[Asia Economy Reporter Jang Sehee] The government emphasized that the upcoming New Deal Fund is not a concept that directly guarantees a fixed rate of return.

On the 20th, Kim Yong-beom, First Vice Minister of the Ministry of Economy and Finance, held a briefing on the results of the "2nd Korean New Deal Ministerial Meeting and the 14th Emergency Economic Central Countermeasures Headquarters Meeting," stating, "The New Deal Fund is not a concept that directly guarantees a fixed return."

Vice Minister Kim added, "We are reviewing the fund structure with the aim of providing the public with a more stable and profitable fund."

The New Deal Fund envisioned by the government is a method where project-specific funds, which will serve as financial resources for Korean New Deal projects such as the Digital New Deal and Green New Deal, are sold through financial companies so that anyone can invest.

Initially, the ruling party and government argued that the New Deal Fund should provide a basic return of around 3% as well as tax benefits to enable higher profits, but the government is currently planning to focus more on increasing tax benefits rather than guaranteeing returns.

Deputy Prime Minister Hong also stated earlier, "We plan to intensively discuss the New Deal Fund and finalize and announce the details as soon as possible," adding, "In addition to the government's seed money role, we will establish an incentive system to ensure that abundant private liquidity leads to productive investments in the Korean New Deal."

Meanwhile, besides establishing the New Deal Fund, the government decided to reflect more than 20 trillion won in the next year's budget for Korean New Deal project financing to guide private liquidity into productive investments. Additionally, measures to strengthen the role of public institutions have been prepared. The government assigned public institutions to manage 40 key projects. Furthermore, 137+a autonomous diffusion projects will be discovered and implemented through a two-track approach.

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