South Korean Government to Boost Struggling Construction Sector and Provincial Economies: Acting President

Synopsis

On February 19, South Korea's acting President Choi Sang-mok outlined plans to support the construction sector by expanding local development projects and purchasing unsold new homes in provincial areas, addressing concerns of weak domestic demand and economic uncertainties.

Key Takeaways

Government to purchase 3,000 unsold apartments.
Incentives for mortgages in provincial regions.
Focus on local development projects.
Infrastructure improvements for public safety.
Investment of 260 billion won for aviation safety upgrades.

Seoul, Feb 19 (NationPress) The acting President of South Korea, Choi Sang-mok, announced on Wednesday that the government intends to enhance local development initiatives and acquire unsold new residences in provincial areas to bolster the struggling construction sector facing diminished domestic demand.

This strategy was unveiled during a meeting focused on evaluating citizens' welfare and the economy with pertinent ministers, emphasizing that South Korea is encountering increasing downside risks due to rising uncertainties both domestically and internationally, as reported by Yonhap news agency.

Choi stated, "The Korea Land & Housing Corp. (LH) will purchase approximately 3,000 unsold new apartments in provincial locations and will assess further acquisitions based on market conditions."

There has been a significant uptick in the number of unsold properties in non-metropolitan areas as a result of a cooling real estate market and sluggish growth trends.

The government plans to provide incentives to financial institutions that extend more mortgage options for home buyers in provincial areas, and further details regarding potential preferential loan rates for these borrowers will be announced, Choi added.

To stimulate investment in provincial territories, the government aims to promote various local development projects, such as constructing new underground railway systems in the southern city of Busan, the central city of Daejeon, and Ansan, located southwest of Seoul.

Policy efforts will also concentrate on executing infrastructure initiatives that enhance public safety.

Choi remarked, "To guarantee aviation safety, the government will implement bird detection radars at 15 airports nationwide and upgrade facilities. We plan to invest 260 billion won (US$180.36 million) by 2027 for these projects."