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(LEAD) Moon says gov't to create 20 tln-won 'New Deal' fund, requests financial sector's support

All News 11:16 September 03, 2020

(ATTN: UPDATES with Moon's remarks; CHANGES headline, photo)

SEOUL, Sept. 3 (Yonhap) -- President Moon Jae-in announced Thursday that the government will create a 20 trillion-won (US$16.8 billion) "New Deal fund" for people to invest in relevant infrastructure projects.

He also pledged "bold" regulatory reform to facilitate the Korean-version New Deal program, as he sought support from South Korea's financial firms for funding.

"Over the coming five years, 100 trillion won will be invested from policy financing in the Korean version of the New Deal and from companies, and 70 trillion won from private financing," he said during a Cheong Wa Dae meeting with the leaders of the country's major financial groups.

It marked the inaugural session, chaired by Moon, to discuss detailed strategies on implementing the policy drive, which the president said would "open the future of the Korean economy."

He said the government plans to launch the New Deal fund, worth 20 trillion won, to enable ordinary people to join the government's initiative in person, with loss risks shared, tax benefits and stable profits.

President Moon Jae-in (C) speaks at the first meeting on Korean-version New Deal strategy at Cheong Wa Dae in Seoul on Sept. 3, 2020. (Yonhap)

The president emphasized the role of the financial sector for the success of the so-called K-New Deal.

"Finance has played a big role whenever the country has faced a difficult time," he said. "The success of the Korean-version New Deal will be possible when private investment is activated and the people participate dynamically."

He assured the businesses that his administration will "push speedily for system improvements and regulatory reform, necessary for expediting the Korean-version New Deal."

Regulatory reform is, indeed, another prerequisite for the success of the initiative, he stressed, adding that the government will break regulations restricting the project and relevant corporate activities in a "bold" manner.

Among attendees were the chiefs of the country's 10 largest financial groups, including KB, Shinhan, Hana, Woori and Nonghyup, as well as the heads of several policy lenders.

Also present were Finance Minister Hong Nam-ki, Financial Services Commission Chairman Eun Sung-soo and Financial Supervisory Service Governor Yoon Seuk-heun.

The number of on-site attendees was limited to around 30 in consideration of social distancing guidelines against COVID-19, with some other government officials and private financiers joining it remotely.

The Korean version of the New Deal is aimed at creating jobs, revitalizing the economy and preparing for the post-coronavirus era. Moon said it represents the government's efforts to turn South Korea's economy into a "pace-setting" and low-carbon one.

Digital and green are two keywords in the initiative, with AI government, SOC digitalization, green energy and smart green industrial complex also among the major projects.

lcd@yna.co.kr
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