Next week’s 4th Disaster Subsidy Announcement… National income per capita is also disclosed

Next week, the government will announce an additional budget (additional supplement) including the 4th disaster subsidy. It is also revealed how much gross national income per capita (GNI) fell last year in the aftermath of the novel coronavirus infection (Corona 19).

The additional budget to be released by the government on the 2nd of next month will include intensive support for victims such as small business owners and self-employed persons due to the prolonged COVID-19 quarantine, job countermeasures in response to employment shocks, vaccines, and vaccinations, and additional budgets necessary for quarantine.

In addition, the Democratic Party previously announced that the scale of the 4th disaster subsidy was ‘19.5 trillion won plus alpha (α). Schedules were also presented, such as resolution of the Cabinet Meeting on the 2nd of next month, submission to the National Assembly on the 4th, and the handling of the plenary session on the 18th.

President Moon Jae-in has requested that the disaster subsidies start execution in March as much as possible.

On the same day, the National Statistical Office announces the industrial activity trend for January this year. Industrial activity trend is the most comprehensive companion indicator that can diagnose Korea’s real economy situation.

Last month, the domestic market was weak due to the high intensity of COVID-19 distance distancing, but the possibility of an economic recovery is raised as the export sector continues to boom.

On the 4th of next month, the Bank of Korea will disclose the ‘4th quarter of 2020 and annual national income (provisional)’.

The fourth quarter real gross domestic product (GDP) economic growth rate (compared to the previous quarter) announced on the 26th of last month was -1.1%, and the growth rate in 2020 was -1.0%. It is of interest how much the fourth quarter of last year and the annual growth rate will be adjusted, reflecting established indicators such as export and industrial activity trends.

In addition, as the GDP deflator (nominal GDP/real GDP) was finalized last year, statistics on national income per capita as of 2020 also come out.

Earlier, the BOK estimated the per capita national income last year in the range of 31,000 dollars. This is a decrease from $32,115 in 2019.

The financial authorities will announce a plan for a soft landing in preparation for the normalization of the Corona 19 situation next week.

While the financial authorities and the financial sector have formed consensus on the 6-month extension of the loan maturity extension and interest repayment deferred measures scheduled to arrive at the end of March, various plans for a soft landing in the future are being reviewed.

After the grace period, the financial authorities decided to come up with various long-term and installment repayment methods so that the burden of repayment by borrowers would not be concentrated at one time.

The five principles are: providing consulting on the optimal repayment plan, allowing extension of maturity if the remaining maturity is shorter than the grace period, non-imposition of interest on the repayment deferred interest, early repayment without interim repayment fees, and determining the method and period of repayment by the borrower.

The financial authorities will also provide regular diagnosis of the situation and forward guidance to improve the predictability of market participants.

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