Yoon: "25 Trillion Won Small Business Measures... Low-Interest Debt Refinancing Loans Expanded to Medium-Low Credit Borrowers"

Presiding Over the 'Second Half Economic Policy Direction' Meeting

President Yoon Suk-yeol is speaking at the 'Second Half Economic Policy Direction and Dynamic Economy Roadmap Announcement' event held on the 3rd at the Blue House State Guesthouse in Jongno-gu, Seoul. [Image source=Yonhap News]

President Yoon Suk-yeol stated on the 3rd, "The government has prepared a comprehensive support plan for small business owners worth 25 trillion won," adding, "We will expand the scope of low-interest refinancing loans from low-credit borrowers to medium-low credit borrowers to reduce the interest burden on small business owners." He also emphasized, "Rather than populist cash handouts, we will provide sufficient tailored support to small business owners in urgent need and pursue structural measures." The intention is to ease the financial strain on small business owners who have been hit hard by prolonged high interest rates.

On the same day, President Yoon presided over a meeting at the Blue House State Guest House to announce the 'Second Half Economic Policy Direction and Dynamic Economy Roadmap,' stating, "We will alleviate the essential cost burdens of small business owners." This marks the fifth time since his inauguration that President Yoon has chaired a meeting discussing economic policy directions.

In his opening remarks, President Yoon pointed out, "Small business owners, who suffered the most during the pandemic, are still facing difficulties," and noted, "Loan support for small business owners who borrowed during the COVID-19 period increased sharply, and as a result of excessive business restrictions, their delinquency rates have risen significantly." Diagnosing that the interest burden has greatly increased amid the ongoing high interest rate trend, along with rising labor and rental costs, President Yoon proposed expanding the low-interest refinancing loan support from low-credit borrowers to medium-low credit borrowers to reduce the interest burden on small business owners.

President Yoon said, "We will extend the repayment period of policy funds and guaranteed loans up to five years for up to 800,000 small business owners and also ease the burden of electricity and rent," emphasizing, "We will double the sales criteria for electricity fee support from the current 30 million won per year to 60 million won, expanding support to up to 500,000 small business owners."

He also presented measures to reduce the rental burden on small business owners. President Yoon stated, "For small business owners facing closure, we will support debt restructuring along with revival assistance," and added, "We will expand the New Start Fund, which was previously only available to small business owners affected by COVID-19, to all small business owners who operated their businesses until the end of June this year, increasing the fund size by 10 trillion won to support approximately 300,000 additional people."

President Yoon Suk-yeol is speaking at the 'Second Half Economic Policy Direction and Dynamic Economy Roadmap Announcement' event held on the 3rd at the Blue House Guesthouse in Jongno-gu, Seoul. [Image source=Yonhap News]

"Tailored Support, Not Populist Cash Handouts"

On the same day, President Yoon reiterated his negative stance on simple cash support policies such as the opposition party’s proposal to provide 250,000 won per person nationwide. He emphasized, "Rather than populist cash handouts, we will provide sufficient tailored support to small business owners in urgent need and pursue structural measures." This is interpreted as a critique of the Democratic Party of Korea’s recent submission of the Livelihood Recovery Support Fund bill to the National Assembly’s Administrative and Security Committee plenary session. The bill, led by former Democratic Party leader Lee Jae-myung, includes provisions to provide regional gift certificates worth 250,000 to 350,000 won per person nationwide based on income levels.

President Yoon also harshly criticized indiscriminate cash support and populism at the Cabinet meeting held on April 16, shortly after the April 10 general election, stating, "Indiscriminate cash support and populism ruin the country's future." The Presidential Office explained, "President Yoon emphasized that while sufficiently supporting small business owners in urgent need to overcome the crisis and revive, structural and permanent measures must be pursued alongside temporary cash handouts," adding, "Sustainable growth of the national economy is essential for fundamental improvement of people’s livelihoods."

Efforts will also be made to establish and expand value-up programs that increase corporate value and provide more asset-building opportunities for citizens. President Yoon said, "We will provide tax benefits to companies that actively increase dividends and promote low-rate separate taxation on shareholders’ dividend income," emphasizing, "We will also address structural problems to stabilize the difficult livelihood situation." Furthermore, he stated, "We will significantly increase housing supply so that citizens can find homes where and when they want," adding, "We will supply more than 50,000 rental homes for citizens and youth by utilizing old government buildings in urban areas and increase long-term rentals for the middle class by more than 100,000 units."

Structural improvements in food prices will also be pursued. President Yoon said, "By utilizing advanced science and technology, we will increase productivity in agriculture, livestock, and fisheries, and by 2027, we will expand online wholesale market transactions to 5 trillion won, the current scale of Garak Market transactions, to promote competition among distribution channels and strengthen protection for producers and consumers," adding, "We will also continue efforts to secure overseas supply sources through tariff quotas."