Additional W594b in loans to be provided to tourism industry

The departure floor at Incheon Airport stands empty in June due to the spread of COVID-19. (Yonhap)

South Korean tourism businesses that are suffering due to the pandemic will be eligible for additional loans from the Ministry of Culture, Sports and Tourism.

A total of 594 billion won ($546.57 million) will be provided in the form of additional loans, while repayment may be deferred for 100 billion won worth of loans that are due next year.

“We made changes by actively reflecting various feedback from the tourism industry, which is currently experiencing difficulties. We hope that these measures can relieve the industry’s pain,” a Culture Ministry official said in a statement.

Anticipating high demand for loans in the first half of 2021, the Culture Ministry will provide 70 percent of the loans, or some 420 billion won, during this period.

Before the COVID-19 pandemic hit, around 70 percent to 80 percent of ministry tourism loans were used to improve facilities, according to the Culture Ministry. However, this year the ministry saw a surge in demand for loans to cover operation costs.

Demand for such loans is likely to remain high in 2021, and the ministry said it would prioritize those applications in the screening process.

Also, owners of restaurants with liquor licenses and restaurants that cater to foreign clientele, as well as owners of businesses related to rail tourism, will newly be eligible for loans in 2021. Loan application requirements will be eased, the Culture Ministry said, with companies able to borrow the equivalent of half their operating costs during their most expensive year out of the last three years. The change was made because most businesses saw their operating costs decrease this year due to the pandemic.

Business owners will be able to apply for loans anytime and loan screenings will be done monthly. This year, companies could only apply every quarter.

More details are provided on the Culture Ministry’s website at www.mcst.go.kr. 

By Song Seung-hyun (ssh@heraldcorp.com)

Words in This Article

pandemic - adj. (of a disease) existing in almost all of an area or in almost all of a group of people, animals, or plants

eligible - adj. having the necessary qualities or satisfying the necessary conditions

repayment - n. amounts of money which you may at regular intervals to a person or organization in order to repay a debt

surge - n. a sudden and great increase

deferred- adj. delayed until a later time

Comprehension Quiz

What is the article mainly about?

What are the South Korean tourism businesses currently suffering from?

What kind of business owners can be eligible for loans? 

Besides loans from country, what else could be the help for business owners due to thepandemic?