[2025 Audit] "KDB's U.S. Tariff Response Program Execution Rate at 0.5% in Initial Phase"

Execution for Only Four Companies and 15 Billion Won by August
Yoo Dongsu Stresses Need to Address Inadequate Initial Response

The initial two-month execution rate of the "Crisis Response Special Program," established by Korea Development Bank to prepare for the impact of U.S. tariffs, has been found to be extremely low.

According to data submitted by Yoo Dongsu, a member of the National Assembly's Political Affairs Committee from the Democratic Party of Korea, on October 22, support provided under the "Crisis Response Special Program" through August since its launch amounted to only 15 billion won for four companies, resulting in an execution rate of just 0.5%.

Korea Development Bank created the 3 trillion won "Crisis Response Special Program" in May of this year, funded by an additional 50 billion won supplementary budget, to minimize the tariff shock that domestic export companies could face following the launch of the second Trump administration in the United States.

In September, Korea Development Bank implemented institutional reforms, including raising the support limit per company and expanding the interest rate reduction. The support limit for small and medium-sized enterprises was raised from 3 billion won to 30 billion won, for mid-sized companies from 5 billion won to 50 billion won, and for the first time, large companies became eligible with a limit of 100 billion won. The maximum interest rate reduction was expanded from 0.2% to 0.5%. Following these reforms, support provided in September surged to 1.251 trillion won for 107 companies, and the cumulative execution rate rose sharply to 42.2%.

However, Yoo Dongsu pointed out that the sluggish initial execution and the abrupt overhaul of the program in early September indicate a lack of adequate advance preparation, such as demand surveys for companies expected to be affected.

Yoo Dongsu, member of the Democratic Party of Korea. Office of Yoo Dongsu

Meanwhile, Korea Development Bank has been operating a separate 2 trillion won "Export Competitiveness Enhancement Program" with its own funds since this year to boost the export competitiveness of small and medium-sized and mid-sized companies. The program targets companies with export performance in the past two years, meaning that export companies affected by tariffs could potentially receive overlapping support from both the "Crisis Response Special Program" and this program.

Although overlapping support is possible since the two programs have different objectives, Yoo Dongsu emphasized the need for stronger post-support management, including verifying whether funds are actually being executed as intended for each program.

Yoo Dongsu stated, "The tariff crisis in the United States is right before us, but the funds have remained only on paper. The fact that a program created for rapid response through a supplementary budget was virtually at a standstill for the first two months indicates a lack of demand surveys and preparation for companies expected to be affected."

He added, "The sharp increase in September's performance could be seen as a 'push-style execution' to make up for the early shortfall ahead of the parliamentary audit. Since tariff burdens hit small and secondary vendor companies with less financial capacity harder than large corporations, we must prevent a concentration of support for large companies and strengthen customized support focused on small businesses."