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Electronics must be included among relief fund beneficiaries
The government has named seven industries ― automobiles, shipbuilding, machinery, petrochemicals, oil refining, steel and aircraft manufacturing ― as key industries subject to a relief fund designed to help weather the coronavirus pandemic. The decision brings the number of industries benefiting from the 40 trillion won ($33.3 billion) key industry stabilization fund to nine along with aviation and shipping.
The fund is a massive relief package created to help the country's core industries weather the fallout from the pandemic. The government has expanded the industries eligible for the fund as the economic fallout from COVID-19 spreads across the board beyond aviation and shipping. The decision is a step in the right direction necessary to stop the basic industries that affect our overall economy and national security from going from bad to worse.
The problem is that electronics has been excluded despite cries for inclusion from industry officials, who claim that manufacturers of electronic components and equipment, which are usually small- and medium-sized enterprises (SMEs), have been hit hard by the coronavirus outbreak.
Industry watchers say the plight of the electronics industry has been masked by a few well-performing companies. Samsung Electronics, for example, issued an earnings surprise in the second quarter thanks to brisk semiconductor shipments. In contrast, many smaller electronics firms seem to be in dire straits owing to sluggish sales and reduced factory utilization.
The exclusion of electronics is quite worrisome, given that the decision ignores the importance of this industry in the Fourth Industrial Revolution. The ecosystem for the electronics industry is vast, from large companies to SMEs.
This requires the government to look closely at how the industry is composed and the damage being done to different companies by the COVID-19 pandemic. The government should think twice before making a final decision on how to operate the key industry stabilization fund.
