Deputy Minister Ki Jae: "Preparing for Prolonged COVID-19... Will Strengthen Financial Support"

"Limited Possibility of Sharp Financial Market Deterioration if the COVID-19 Crisis is Overcome"
"Government Faces Dilemma in Achieving Conflicting Goals of Quarantine and Economy"

Kim Yong-beom, Vice Minister of Strategy and Finance, is delivering opening remarks while presiding over the 'Macroeconomic Financial Meeting' held on the 25th at the Bankers' Hall in Jung-gu, Seoul.

[Sejong=Asia Economy Reporter Kim Hyun-jung] Kim Yong-beom, the 1st Vice Minister of Strategy and Finance, announced that financial support will be strengthened to prepare for the prolonged COVID-19 pandemic.

On the morning of the 25th, Vice Minister Kim held a macroeconomic and financial meeting at the Seoul Banking Hall and stated, "The domestic COVID-19 situation, which had been relatively stable, is rapidly changing." He explained, "If social distancing is strengthened, there is a possibility that liquidity-vulnerable groups such as small and medium-sized enterprises and small business owners may face financial difficulties. We will re-examine the measures taken so far and provide prompt and sufficient support so that financial institutions can fully back efforts to overcome the crisis in the real sector."

He also emphasized efforts to strengthen protection for vulnerable groups and support recovery. He stressed, "Until COVID-19 is completely eradicated, there is always a risk of re-spread of the infectious disease, and the shocks from repeated crises may be more concentrated on vulnerable groups. We will accelerate the implementation of employment stability package projects such as the 575,000 direct job projects and emergency employment stability support funds for special types of workers and freelancers, and continue efforts to strengthen employment and social safety nets." He added, "We will mobilize all available resources to ensure rapid disaster support and recovery for areas damaged by the prolonged rainy season and heavy rains. We will also pay close attention to potential price instability caused by supply instability of some agricultural and livestock products, and make every effort to stabilize supply by expanding supply volumes and supporting production of agricultural and livestock products whose prices have surged."

Regarding the recent economic and financial sectors, he predicted that if the COVID-19 related critical phase is overcome well, the possibility of a sharp deterioration is low. He said, "Unlike last March when major countries' stock markets plunged, the stock markets of major countries worldwide are still maintaining an upward trend, and liquidity is being supplied quickly and sufficiently, so there are no signs of credit crunch in financial markets. Considering that Korea has also prepared a 175 trillion won scale livelihood and financial stability package, which has further strengthened the market safety net, the possibility of a sharp deterioration in the domestic financial market will be limited."

He also explained the government's dilemma of having to achieve the conflicting goals of 'quarantine' and 'economy' simultaneously. Vice Minister Kim said, "If quarantine measures are strengthened to prevent the spread of infectious diseases, economic activity contraction is inevitable, and if quarantine measures are eased for economic recovery, the infectious disease may re-spread. To wisely overcome this difficult situation, tasks for economic recovery will be implemented with adjusted speed considering the spread of the infectious disease, while tasks to reinforce the weak links of our economy and prepare for the prolonged situation will be accelerated."

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