South Korea's industry minister has vowed to come up with support packages for the auto and shipbuilding companies to tackle challenges facing the sluggish manufacturing sectors.
Sung Yun-mo, minister of trade, industry and energy, put top priority on revitalizing the key manufacturing sectors as local parts makers have been grappling with falling demand and financial problems.
"Auto and shipbuilding industries are the most hard hit sectors in the short term," Sung said in a meeting with reporters in Sejong on Oct. 30, 2018. "We will unveil support plans for the sectors before mid-November."
The policymaker said the government will provide 1 trillion won (US$877.5 million) worth of financial aid for cash-strapped local parts makers and seek ways to boost demand in the short term.
"The short-term measures should ease the financial burden on local firms, lower regulations and create demand," the minister said.
In the long term, the government and private sectors should cooperate to enhance their global competitiveness to catch up with the latest industry trends, he noted.
The Korean auto industry has faced weak demand and fierce competition in the global market and is dealing with fallout from General Motors' closing of its underperforming factory in Gunsan.
Gunsan, an industrial city on the southwestern coast, was designated as an "industrial crisis zone" following the American automaker's plant closure in May and many of GM's local contractors have struggled to keep their businesses afloat.
Major carmakers, including Hyundai Motor Co. and Kia Motors Corp., also worry that the United States may slap heavy tariffs on foreign autos, which could severely hurt their price competitiveness in the key market. (Yonhap)