Government Provides Emergency Financial Support to Tourism Industry Hit Hard by COVID-19

Hong Nam-ki, Deputy Prime Minister and Minister of Economy and Finance, is speaking while presiding over the Economic Ministers' Meeting on COVID-19 Response and the Related Ministers' Meeting on Japan's Export Regulations held at the Government Seoul Office Building on the morning of the 17th.
[Image source=Yonhap News]

[Asia Economy Reporter Kim Heung-soon] The Ministry of Culture, Sports and Tourism announced on the 17th that it will provide emergency financial support to the tourism industry, which has been hit hard by large-scale travel reservation cancellations and a decrease in tourists due to the spread of the novel coronavirus infection (COVID-19).

First, using a total of 50 billion KRW from the Tourism Promotion Development Fund, special loans will be provided to small and medium-sized tourism businesses severely affected by COVID-19. Loans will be granted without collateral through public institution credit guarantees, applying a preferential interest rate of 1%. The support limit will be raised to a maximum of 200 million KRW. The repayment period will also be extended by one year to 6 years (3 years grace period and 3 years repayment). Businesses wishing to apply for special loans can apply for credit guarantees at 144 regional credit guarantee foundations nationwide starting from the 19th, receive a credit guarantee certificate, and then obtain loans at NongHyup Bank branches nationwide.

As of the 17th, businesses that have received tourism fund loans less than a year ago and are having difficulty repaying the principal can apply for a repayment deferral at each bank. Additionally, the preferential interest rate, which was abolished earlier this year for hotel facility loans in Seoul, Gyeonggi, and Incheon areas, will be maintained at 1%, the same as hotels in other regions. Operating fund loans for the second quarter will also be promoted early in early March. Support of up to 3 billion KRW per business will be provided, and low-cost carriers (LCCs) will also be able to borrow up to 3 billion KRW for operating funds or facility funds.

A Ministry of Culture, Sports and Tourism official stated, "We hope that the tourism industry, which is struggling due to the spread of COVID-19, will stabilize as soon as possible."