'COVID-19 Direct Hit' Major Duty-Free Shops Also Receive 20% Rent Reduction (Comprehensive)

Deputy Prime Minister Hong Nam-ki Announces at Crisis Management Meeting
Raises Rent Reduction Rate for SMEs and Small Business Owners to 50%

Hong Nam-ki, Deputy Prime Minister and Minister of Economy and Finance, is delivering opening remarks while presiding over the "13th Economic Ministers' Meeting on COVID-19 Response and 3rd Crisis Management Meeting" held on the 1st at the Government Seoul Office in Gwanghwamun, Seoul.

[Sejong=Asia Economy Reporters Kim Hyun-jung and Jang Se-hee] The government has decided to further reduce rental fees for airport commercial facilities to support the tourism industry, which has been hit hard by the COVID-19 pandemic, and to include large corporations, which had previously been excluded, in the rent reduction program. Alongside this, direct and indirect support for the telecommunications industry and small business owners, as well as reductions in fees for the film industry, will also be promoted.

On the 1st, Hong Nam-ki, Deputy Prime Minister and Minister of Economy and Finance, held an economic ministers' meeting and crisis management meeting at the Government Complex Seoul to announce these measures in response to COVID-19. First, to support the duty-free shop industry, which has been severely affected by the sharp decline in tourists following the spread of COVID-19, the rent reduction rate for small and medium-sized enterprises and small business owners in airport commercial facilities such as duty-free shops, restaurants, banks, and currency exchange offices will be increased from the existing 25% to 50%. Additionally, rent for large and medium-sized enterprises will be reduced by 20%. These measures will be temporarily applied for up to six months until the number of airport passengers recovers to 60% of last year's level. Considering the cash flow difficulties of the Korea Airports Corporation caused by the rent reductions, the Ministry of Economy and Finance plans to revise the dividend business guidelines to adjust the timing of government dividend payments.

Furthermore, until the infectious disease alert is lifted, hotel rating evaluations will be postponed to reduce the burden on the industry, and safety inspection fees for amusement rides within amusement facilities will be reduced by 50%. Customized training will be provided for 7,500 travel industry workers who are currently on leave or furlough, and capacity-building education will be supported to cultivate professionals in the MICE (Meetings, Incentives, Conferences, and Exhibitions) sector.

For the film industry, which has seen a sharp decline in sales due to avoidance of enclosed movie theaters, the film development fund fees from February onward will be retroactively and temporarily waived. From 2016 to 2019, the related fees averaged 54 billion KRW annually.

In addition, marketing and special exhibition operations, production support funds, and job retraining will be provided for workers in film distribution and production. To revitalize movie attendance after the COVID-19 outbreak, 1 million discount tickets and promotional campaigns will also be supported.

Emergency support will also be provided to approximately 26,000 small and medium-sized terminal distribution stores and about 630 construction companies in the telecommunications sector. Dealerships will receive 137 billion KRW in rent and operating funds, and repayment of 110.6 billion KRW in interest on credit purchases of terminals will be deferred. Small and medium-sized construction companies will also receive 163 billion KRW to alleviate financial difficulties. Support such as interest-free installment plans and reduced loan interest rates will be provided to small business owners experiencing poor sales, targeting subsidiary franchise stores. Additionally, to provide work opportunities for construction companies and small equipment companies, investment in 5G communication networks will be increased from 2.7 trillion KRW to 4 trillion KRW in the first half of this year.

Moreover, a one-month reduction in telecommunications and broadcasting fees will be promoted for all small business owners (30,000 locations) using telecommunications and broadcasting services. Telecommunications companies will bear the cost for telecommunications, while paid broadcasting companies will be encouraged to voluntarily reduce broadcasting fees.

Deputy Prime Minister Hong stated on the day, "It is most important to identify and promptly fill policy support needs in blind spots that are desperately required for survival and endurance on the ground," adding, "We will focus policy capabilities on measures for self-employed individuals, small business owners, and marginal companies, as well as on employment retention responses." He also emphasized, "We will continue to discuss forecasts and preparations for greater economic ripple effects to come, especially preemptive policy directions for employment market shocks and people losing jobs, as well as post-COVID-19 economic policy directions such as fostering non-face-to-face industries like remote and video conferencing."