Korean govt boosts trade finance to USD 209 bln to defend exports

Tuesday 5 March 2019 10:51 CET | News

The South Korean government has announced stretching financing for the country’s exporters to USD 208.8 bln as exports contract the third month in a row.

The government will strengthen trade finance across the board to stimulate exports, according to government officials The government will allocate aprox. USD 89 million to aid promising export firms under financial struggles to receive loan guarantees after signing contracts. Exporters would be also allowed to cash their bonds promptly under a new system, which will significantly shorten the process. Currently it takes more than six months to cash their bonds.

In order to diversify export items and markets, the government will help small- and mid-sized exporters develop strategic items and projects that can garner interest from overseas consumers. The government will open a new center in Toshkent in Uzbekistan in March 2019 to support Korean companies to win plant construction orders in Central Asia and set up an office at Korea Trade-Investment Promotion Agency (KOTRA) that helps companies enter ASEAN countries under the Moon Jae-in administration’s New Southern Policy, government officials have stated.

The country’s exports fell 11.1% since 2018 to USD 39.56 billion in February 2019, extending the losing streak for the third consecutive month. The main cause of the sluggishness was the 25% on-year plunge in chip shipments that had kept double-digit growth last year. Semiconductors have been the country’s mainstay export item.

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Keywords: South Korea, South Korean Government, trade finance, exports, Korea Trade-Investment Promotion Agency, KOTRA, APAC, Asia
Countries: World