[2025 Economic Policy] 'Record High' Trade Finance and Export Finance Support... Full Effort to Maintain Export Growth Momentum

2025 Economic Policy Direction
Export Growth Rate '2024: 8.2% → 2025: 1.5%'
Trade Finance 360 Trillion KRW · Export Support Budget 2.9 Trillion KRW

The government, anticipating an export growth rate of only 1.5% this year, has decided to put all its efforts into maintaining the export growth trend by injecting the largest-ever trade finance and export support budget.

On the 2nd, the government held a joint briefing with related ministries at the Government Complex Seoul and announced the '2025 Economic Policy Direction' containing these details.

Last year, exports continued a sharp increase until the third quarter, supported by the semiconductor boom, but the growth slowed in the fourth quarter due to intensified competition in key industries. Recently, the decline in oil prices and production disruptions caused by strikes have also constrained export growth, mainly in petroleum products and automobiles. The government expects that high-performance semiconductors and shipbuilding will maintain a favorable trend this year, but exports of items facing intensified competition, such as general-purpose semiconductors and petrochemicals, are expected to slow down. Accordingly, the export growth rate is forecasted to be only 1.5%.

◆360 trillion KRW in trade finance supply= Despite these changes in the trade environment, the government plans to strengthen support for export diversification and resolving export difficulties so that Korean companies can focus on exports without wavering. First, it will comprehensively support export portfolio diversification. Trade finance will be supplied at the largest scale ever, amounting to 360 trillion KRW. The support scale for the ultra-large order special program will also be expanded by 10 trillion KRW.

Specialized programs for export diversification and support for key industries will also be increased. Financial incentives will be provided for new industries such as artificial intelligence (AI) and bio, as well as for export item and regional diversification including the Global South. Funding support and financial incentives will be offered for research and development (R&D), mergers and acquisitions (M&A), and business restructuring.

Based on the largest-ever export support budget (2.9 trillion KRW), new export businesses will be fostered and diversification of items and regions will be pursued. For export SMEs, the tax support package including corporate tax, value-added tax, and tax audits will be extended for one year until the end of this year.

◆New external economic strategy implementation= The government will take proactive and systematic measures to respond to changes in the external environment. In particular, it will pursue building cooperative relations with the new U.S. administration launching this month. First, it plans to respond to major economic issues related to the new U.S. administration through the 'Foreign Relations Ministers Meeting.' It will analyze possible policy scenarios and impacts across industries, trade, and economic security sectors and prepare an action plan.

Externally, the government will deepen and develop Korea-U.S. cooperation based on diversified communication channels. It plans to quickly establish cooperation channels with the second Trump administration and lay the foundation for expanded cooperation through close communication with the U.S. Congress and state governments.

It will also strengthen preparations for intensified competition between the U.S. and China and protectionism. To respond to increased uncertainty in the trade environment, it will expand and sophisticate trade networks to the Global South. It will broaden its base to emerging markets in Asia, Africa, the Middle East, and Latin America, while accelerating improvements and follow-up negotiations on free trade agreements (FTAs) with major countries such as Chile, China, and the United Kingdom. Before the full implementation of the European Union (EU) Carbon Border Adjustment Mechanism (CBAM), efforts will be made to alleviate the burden on Korean companies, and similar trends such as the U.S. Foreign Pollution Fee Act (FPFA) will be continuously monitored.

◆Full-scale investment in supply chain fund= The government will also strengthen multifaceted and comprehensive support to respond to supply chain risks. It plans to expand domestic production support and promote investment in critical minerals. First, to expand domestic production, it will increase subsidies for foreign and local investments when new or expanded domestic factories related to economic security items and services are established. A new supply chain program will be introduced to support supply stability through domestic production, import diversification, and stockpiling for items that are expected to suffer significant economic and industrial damage in the event of a supply chain crisis but currently lack adequate response measures.

To promote investment in critical minerals, a public-private 'Critical Minerals Investment Council' will provide information, consulting, and package support for necessary funds such as loans, investments, and guarantees through project discovery. The government plans to promote public-private joint investments using 50 billion KRW from the supply chain fund and undertake long-term investments according to annual demand.