Gov't to offer voucher packages, trade financing for export firms amid US tariff uncertainties
Containers are waiting to be shipped at a port in Busan, Feb. 12. Yonhap
The Korean government has devised a set of support measures for export firms expected to suffer damage from global trade uncertainties sparked by U.S. tariffs, including export vouchers for small and medium-sized enterprises (SMEs) and a record 366 trillion-won ($253.3 billion) trade finance scheme, officials said Tuesday.
The measures were announced in an export strategy meeting presided over by acting President Choi Sang-mok, aimed at minimizing the possible impact on local businesses from the U.S. administration's plan to impose tariffs on various goods from other countries, as well as reciprocal tariffs on its trading partners.
To respond to tariff uncertainties, the government will provide export voucher packages to SMEs to give consultations on their response to the proposed U.S. tariffs, and financial support for their investments overseas.
In a government survey of the SMEs here, 68.7 percent said they expect to suffer damage in American exports under U.S. President Donald Trump's protectionist trade policies, citing the weakening of the price competitiveness of their products, disruptions to securing raw materials and other factors.
The government also plans to draw up the country's largest-ever trade financing scheme, worth 366 trillion won, this year to provide liquidity to local businesses suffering difficulties from high interest rates, volatility in the currency exchange rate and global tariffs.
In detail, 100 trillion won will be used in trade insurance for exporting SMEs and 8.5 trillion won will be spent on helping companies hedge risks from volatility in foreign exchange.
The government said the measures were prepared to overcome heightened trade uncertainties and maintain Korea's export growth momentum in 2025.
Exports, a key growth engine for Korea, increased by 8.1 percent on-year in 2024 to hit a record $683.7 billion.
But exports in the first half of 2025 are expected to be "very difficult" due to the protectionist trade policies of the Trump administration, high interest rates, volatility in the currency exchange rate and competition in advanced industries, as well as global oversupply, the government explained.
Steel products are piled up at a port in Pyeongtaek, Gyeonggi Province, Feb. 11. Yonhap
In addition, the government plans to diversify Korea's trade destinations in response to the protectionist policies of its major trading partners, such as the United States and China.
The government also plans to newly create five overseas export support centers in countries in the Global South, including Mexico, Vietnam and Brazil, as part of efforts to discover new export opportunities in the respective regions.
The government will also supply 55 trillion won in trade insurance financing this year for firms exporting to these regions, up from 48 trillion won in 2024.
Additionally, the government will strengthen support for key industries, including semiconductors, automobiles, rechargeable batteries, biopharmaceuticals and steel.
It also seeks to communicate closely with Washington on the possible reduction or elimination of subsidies for electric vehicles (EVs) in America that have been offered under the U.S. Inflation Reduction Act.
Korea's Deputy Trade Minister Park Jong-won is currently visiting Washington to meet with U.S. government officials and discuss Trump's trade policies and its effect on Korean industries.
Meanwhile, the government will work to foster new engines for exports, such as agriculture and fisheries, with an aim to export $14 billion worth of agricultural products and $3.15 billion worth of seafood products in 2025. (Yonhap)