(1888PressRelease)
November 08, 2008 - The rescue package is aimed to bolster exports which have been hard-hit by the global slow-down.
Exports in South Korea fell to a 13 month low as exports to China dropped for the first time in six years, the Ministry of Knowledge Economy announced on Monday. Exports make up more than half of the country’s gross domestic product.
Finance minister, Kang Mans-soo, conceded that economic growth could fall to the lowest in a decade without the help of the stimulus package. "If the current situation continues, the economy is expected to grow by around 3 percent next year. If the global economy shrinks further, it may be difficult to achieve 3 percent growth," he added.
Smaller firms which face bankruptcy and will also receive credit to survive the crisis. The small firms employ about 90% of the South Korean workforce
The spreading financial crisis has seen the South Korean currency- won and the KOPSI share index losing almost a third of their value since the beginning of 2008. The freeze on liquidity has adversely affected the country’s economy with banks and financial institutes struggling to raise the dollars needed to pay foreign debt.
This is South Korea’s second rescue package in two months. In late November, South Korea’s government announced a rescue package of $130 billion offering a state guarantee on foreign debt and promising to recapitalize financial firms.
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