Finance ministry touts measures to stabilize prices ahead of Chuseok

Economy

Published: 18 Aug. 2023, 16:17 Updated: 18 Aug. 2023, 19:21

Finance ministry touts measures to stabilize prices ahead of Chuseok

First Vice Minister of Economy and Finance Bang Ki-sun speaks at a meeting held in central Seoul on Friday to discuss measures to tame inflation and revitalize the domestic economy. [MINISTRY OF ECONOMY AND FINANCE]

The finance ministry announced a set of measures on Friday to stabilize prices ahead of next month’s Chuseok holiday.

The plans include an extended tax cut on fuel consumption and applying tariff-rate quotas on chicken.

To entice Chinese tourists, there will also be expanded air routes connecting Korea and China.

Specific details of the plans, aimed to revitalize the domestic economy and tame inflation, will be introduced early next month.

The government will extend the tax cut on fuel consumption by another two months to minimize the impacts of the recent rise of global oil prices, said the Ministry of Economy and Finance on Friday.

Tariff-rate quotas will be applied on 30,000 tons of chicken starting in September due to mounting prices, unlike the prices of vegetables that have stabilized from the impacts of strong heat waves, monsoon season and a typhoon over recent weeks.

The ministry “will preemptively respond to price instability in preparation for Chuseok,” which falls on Sept. 28 this year, it said in a statement.

The government will expand Korea-China air routes and open new visa application centers in major Chinese cities, including Beijing and Shenyang, to facilitate the entry of Chinese tourists.

It further vowed to hold various promotions in Seoul in time for China’s National Day holiday, which is traditionally a peak travel season. The holiday lasts from Sept. 29 through Oct. 6 this year.

More details of the promotion plans will be announced in early September.

The announcement follows China’s lifting of a ban on group tours for a list of countries on Aug. 10. Korea has been included on the list since 2017.

Chinese travelers accounted for 30 percent of the total visitors to Korea before the Covid-19 outbreak, the largest slice of any country.

“If the number of Chinese tourists returns to the level seen in average years, that is expected to contribute to revitalizing the domestic economy and improving the travel account,” said the ministry.

Korea’s gross domestic product rises 0.08 percentage points per million Chinese tourists, according to the Bank of Korea data in February.

“The domestic economy is recently showing signs of recovery, but uncertainties remain like the spread of fears involving China’s property market,” said first Vice Minister Bang Ki-sun. “The government will increase efforts to activate domestic, export and investment activities for an economic rebound with a focus centered on prices and public welfare.”

The ministry on Friday also announced plans to distribute more than 21,000 hydrogen buses, 300,000 hydrogen cars and build more than 660 hydrogen car charging stations by 2030.

The number of hydrogen cars have jumped to 33,000 in the first half of this year from 5,000 vehicles in 2019.

BY JIN MIN-JI [jin.minji@joongang.co.kr]