The government plans to set up a guarantee fund of 500 billion won, or roughly 405 million U.S. dollars, to provide more loans to local auto parts firms that have been hit hard by the coronavirus pandemic.
Finance Minister Hong Nam-ki said on Thursday the fund will be financed by the government and carmakers, adding the public sector will buy 9,500 cars by the end of September to prop up auto parts firms.
In order to help boost private consumption, the minister said a nationwide shopping festival will also kick off on June 26 for a two-week run.
Noting that South Korea's consumer sentiment rebounded from an 11-year low in May as the nation eased social distancing rules, Hong said it is a "meaningful signal" for an economic recovery.
<Photo: Yonhap News>
