S. Korea to earmark 1 trillion won to cope with Japan’s export curbs next year

Aug 05, 2019, 09:30 am

		0
Prime Minister Lee Nak-yon (center) speaks at a senior-level tripartite meeting of the government, the ruling party and the presidential office at the National Assembly in Seoul on August 4, 2019./ Photographed by Song Eui-joo

By AsiaToday reporters Lim Yoo-jin & Jeon Seo-in

South Korea plans to earmark more than 1 trillion won (US$833 million) in next year’s budget to support local parts makers and material suppliers that will be directly affected by Japan’s removal of South Korea from its whitelist of trusted trading partners.

Rep. Cho Jeong-sik from the ruling Democratic Party made the remark after a senior-level tripartite meeting of the government, the ruling party and the presidential office on Sunday.

“We will put our top priority in strengthening competitiveness of the materials, parts and equipment industries,” Cho said. “We have decided to mobilize all of the country’s available resources in the fiscal, legal, taxation and financial sectors.”

The government, the ruling party and the presidential office also agreed to form a government-led committee for competitiveness of the materials, parts and equipment industries in order to systematically implement countermeasures. Finance Minister Hong Nam-ki will chair the panel.

In addition, they comprehensively reviewed support measures for minimizing the damage of domestic companies and fostering materials, parts and equipment industries.

They also decided to extend the scope of the Special Act on the development of materials and parts companies, which is expected to end in 2021, to materials, parts and equipment companies. Besides, they will improve current laws by converting them to permanent ones.

The government will establish a win-win partnership model for materials and parts industries by providing funding and tax benefits for cooperation between demand and supply companies.

The government plans to expand its research and development investment on key strategic items and provide rapid support by skipping preliminary feasibility studies. About 100 firms will be given full financial and administrative support to become global companies.

The abrogation of the General Security of Military Information Agreement (GSOMIA) and the review of WTO complaint against Japan’s export curbs will be included in the government’s comprehensive measures to be announced on Monday.

Participants of the meeting agreed to do their best to minimize damage with preemptive action and take the opportunity to turn evils into blessings.

“The government will continue to go ahead with detailed industrial measures against Japan’s economic attack to help the country turn this misfortune into fortune,” Prime Minister Lee Nak-yon said at the meeting.

“The relationship between South Korea and Japan has now reached a major turning point. The government’s unwavering commitment is required,” said Lee Hae-chan, the chairman of the ruling Democratic Party. “The government should actively implement policies so that the incident becomes an opportunity for strengthening industrial competitiveness and creating manufacturing innovation.”

#South Korea #budget #Japan #export curbs #whitelist