Koo Yun-cheol: "We will use all policy tools, including an extra budget, to respond to the Middle East crisis"

[Financial News] Deputy Prime Minister and Minister of Finance and Economy Koo Yun-cheol said on the 11th, "To minimize the impact of the situation in the Middle East on people’s livelihoods and on the economy and industry, we will provide sufficient support by using all available policy tools, including an extra budget."
Koo, who chaired the Emergency Economic Council at Government Complex Seoul that day, added, "If we detect any abnormal signs in the economy, we will respond swiftly and decisively."
Koo stated, "We will expand the existing market stabilization program of more than 100 trillion won if necessary," and stressed, "The government and the Bank of Korea (BOK) will work closely together to carry out additional market stabilization measures in a timely manner, such as an emergency bond buyback and the outright purchase of Korea Treasury bonds."
As concerns persist over oil price instability and rising financial market volatility stemming from the escalating conflict between the United States and Iran, the government fully shifted to an emergency posture starting that day. The Council of Economic Ministers has been converted into the Emergency Economic Council, which will now meet weekly for rapid response. The joint Emergency Response Team of related agencies has also been upgraded to vice-ministerial level.
Koo pledged, "We will do our utmost to stabilize people’s livelihoods in the face of high oil prices." As an immediate response to the surge in oil prices, the government will cut the fuel tax and temporarily increase the diesel fuel price-linked subsidy system for trucks, buses, and taxis.
The fuel price cap system will also be introduced within this week.
In addition, the government will actively provide support through the Small Business Management Stabilization Voucher and the Emergency Management Stability Fund, while reviewing any further assistance measures that may be needed.
At the same time, the government reaffirmed its stance that it will strictly crack down, under a zero-tolerance principle, on any attempts to exploit the crisis for private gain.
The government plans to establish the Notice on the Prohibition of Hoarding and Withholding Sales of Petroleum Products to prevent hoarding and refusal to sell by oil refining companies and gas stations.
Koo said, "We will closely monitor acts that disrupt financial markets, such as spreading fake news and manipulating prices by riding on financial market anxiety, and will respond sternly to any violations we uncover."
Items with a high dependence on the Middle East will be swiftly designated as an economic security item if necessary. In particular, for Naphtha, a basic feedstock for petrochemical products, the government plans to quickly prepare support measures, including fiscal and financial assistance, to address potential supply disruptions by securing alternative import sources and substitute raw materials.
skjung@fnnews.com Jung Sang-geun Reporter