South Korea to pay cash to families, bring in extra budget relief

Seoul (Reuters) – South Korea will make an emergency cash payment to most families and draw up a second supplementary budget next month in a bid to ease the drawn-out economic impact of the coronavirus outbreak, President Moon Jae-in said on Monday.

Moon, after an emergency meeting with economic policymakers, said an “emergency disaster relief payment” of up to 1 million won ($816) would be made to all households except the top 30% by income.

Moon said he would prepare another extra budget for parliamentary approval in April and some small- and medium-sized companies would be exempt from paying partial insurance and utility bills starting this month.

“Citizens suffered from the coronavirus and they all deserve to be rewarded for their pain and participation in preventive efforts,” Moon told the meeting in comments broadcast on television.

“There is a need for the government to reserve as much financial power to brace for an economic shock with no end in sight and promptly respond to labour market insecurity and any potential corporate liquidity crisis.”

The new package is the latest in a recent series of steps the government has taken to ease the pressure on Asia’s fourth-largest economy as it grapples with a major coronavirus outbreak.

Previous measures have included an interest rate cut, a 11.7 trillion won ($9.54 billion) supplementary budget, raising a cap on currency forward positions for banks and a rescue package for companies totalling 100 trillion won ($81.6 billion).

South Korea has largely managed to get an explosive coronavirus epidemic under control.

Its daily number of new infections has been hovering at up to 100 for the past three weeks, but authorities have tightened border checks as small outbreaks emerge and the number of imported cases has risen.

The Korea Centers for Disease Control and Prevention (KCDC) reported 78 new cases on Monday, at least 13 of whom were people who arrived from abroad, most of them South Koreans.

The national tally stood at 9,661, while the death toll rose by 6 to 158. The KCDC said 195 more people had recovered from the virus for a total of 5,228.

South Korea announced on Sunday that all overseas arrivals would have to undergo two weeks of mandatory quarantine starting on April 1.

Breaking the rules is punishable by a year in prison or a fine of up to 10 million won ($8,160).