Koo Yun-cheol: "We will select growth engines for the Five Mega-Regions and Three Special Self-Governing Provinces Policy and soon unveil a seven-part support package"

[Financial News] Deputy Prime Minister and Minister of Economy and Finance Koo Yun-cheol said on the 3rd, "We will soon announce support measures for the Five Mega-Regions and Three Special Self-Governing Provinces Policy, selecting the optimal growth engines that maximize each region's characteristics and capabilities, along with a seven-part package covering fiscal policy, finance, taxation, regulation and talent."
Koo made the remarks while chairing an Emergency Economic Headquarters meeting and a Council of Economic Ministers meeting at Government Complex Sejong on the 3rd. He said the key to staying ahead in the global all-out race for a technological edge lies not in the already saturated Seoul metropolitan area, but in the regions.
Koo stressed that the government will push ahead at full speed with three major mega-projects for a "super-gap Korea": semiconductors, data centers and Physical AI. He added that, in particular, the government will identify regional growth engines for the Five Mega-Regions and Three Special Self-Governing Provinces Policy after gathering demand from local governments and opinions from companies.
The government plans to announce growth engines that reflect the characteristics and potential of each of the Five Mega-Regions and Three Special Self-Governing Provinces, and provide comprehensive support through seven packages covering fiscal policy, finance, taxation, regulation and talent.
At the meeting, the government discussed the plan to promote growth engines under the Five Mega-Regions and Three Special Self-Governing Provinces Policy, emergency support measures for small and medium-sized enterprises facing management difficulties, the third basic plan for personal information protection, and the direction of the 2026 Korea Grand Festival.
Koo said, "Volatility in the foreign exchange and financial markets continues, and difficulties in people's livelihoods persist, with consumer prices rising 3.2% in June." He added, "We will move faster to implement livelihood support measures in response to inflationary pressure, slower employment growth, and greater volatility in exchange rates and interest rates."
First, the government will provide 14.9 trillion won in emergency management funds to small and medium-sized enterprises struggling with the strong won and other challenges.
To that end, it will create a dedicated track for SMEs facing management difficulties caused by the strong won within the emergency management stabilization fund run by the Korea SMEs and Startups Agency.
The support scale of Korea Eximbank's special crisis-response program for SMEs will also be expanded from 7 trillion won to 8 trillion won. The government will also launch a new ultra-low-interest win-win loan program to help companies cope with the strong won, with loans offered at rates based on Korea Eximbank's funding costs.
The guarantee ratio for emergency management stabilization guarantees from KOTEC will be raised from 95% to 100%. The reduction in guarantee fees will also be widened from 0.3 percentage points to 0.4 percentage points.
Support for trade insurance and exchange-rate fluctuation insurance will also be strengthened for importers affected by the strong won.
For small and medium-sized enterprises and mid-sized companies, import insurance premiums will be discounted by 50% through April next year, and the loan guarantee limit for import financing from K-SURE will be preferentially raised by up to two times the current level.
The range of companies eligible for exchange-rate fluctuation insurance will be expanded from some raw material importers to all importers except those dealing in luxury goods.
The premium discount for SMEs will also be doubled from 15% to 30%.
The government will also extend payment deadlines for corporate, value-added and income taxes, while supporting SMEs in strengthening their foreign-exchange response capabilities through consulting on exchange-rate risk, among other measures.
In addition, the government will establish the third basic plan for personal information protection to safeguard citizens' personal data in the AI era.
Rather than applying uniform regulations, it will govern personal information in proportion to risk levels and improve laws and systems in line with the development of new technologies such as Agentic AI.
Hubs that can utilize pseudonymized and anonymized data will be built in regional centers, and one-stop support will be provided from reporting to compensation in the event of a personal data breach.
The national discount festival, the Korea Grand Festival, will be held for 18 days from Oct. 29 to Nov. 15 this year.
This year, the government plans to offer record-high discounts on consumer goods closely tied to daily life, including manufactured products such as cars, home appliances and clothing, as well as agricultural, livestock and seafood products for the kimchi-making season.
It also plans to distribute 70,000 lodging coupons to areas outside the Seoul metropolitan region and actively link the event with local festivals nationwide to boost tourism and consumption in the regions.
During the event, the discount rate for Digital Onnuri Gift Certificates will be raised from 7% to 10%, and various consumer benefits such as credit card cashback and point rewards will also be offered.
skjung@fnnews.com Jung Sang-gyun Reporter