Korea stands against trade protectionism

[THE INVESTOR] Finance Minister Yoo Il-ho said Thursday that Korea would firmly stand against trade protectionism by further seeking economic partnerships with other economies despite growing uncertainties, while urging again the National Assembly to approve its extra spending proposal.

In a meeting to review its external economic conditions, the finance minister said that the issue of protectionism was rising amid uncertainties on Brexit and becoming a major topic in the US presidential race.

About 10 industrial sectors out of 15 surveyed by the Federation of Korean Industries said that they are being directly and indirectly affected by protectionism.

Finance Minister Yoo Il-ho(left)

“We will reject (the idea of) trade protectionism and seek to lead in overcoming this,” Yoo said in the meeting.

“Korea will stand against any kind of protectionism through multiple diplomatic channels.”

He added that the government would use all of its available resources to seek economic partnerships to reduce uncertainties fueled by risks of protectionism.

The country’s trade policy will remain the same -- focusing on making inroads into new markets in China, Southeast Asia and Latin America by continuing its negotiations with other economies, the minister said.

Ahead of a summit between South Korea and Russia from Sept. 2-3, Yoo said that deteriorating relations between the two Koreas should not get in the way of the South’s relationship with Russia.

“The recent inter-Korean relations should not affect South Korea-Russia relations,” he said, noting that although the US and EU moved to sanction Russia in the aftermath of the Ukraine crisis, South Korea maintained its economic partnership with Russia.

Yoo also urged lawmakers again to pass the government’s supplementary budget, saying that it needs to rapidly carry out its extra spending for those who lost jobs due to corporate restructuring and the young.

The political circle has been arguing over the government’s 11 trillion won ($10 billion) supplementary budget, with the main opposition Minjoo Party demanding the government reflect the growing need for education and welfare finances for children in provincial areas.

Last month, the Finance Ministry announced plans to spend an additional 9.8 trillion won. The extra budget includes financing the restructuring of shipping and shipbuilding companies by recapitalizing state-run policy banks. It will also provide capital for start-up entrepreneurs and help regional small businesses. Of the 9.8 trillion won, 3.7 trillion won will be provided to regional administrations for public education and facilities development.

From the 11 trillion won budget, 1.2 trillion won will be used to pay back government debts.

By Park Hyong-ki/The Korea Herald (hkp@heraldcorp.com)