South Korea declares industrial crisis in Gunsan, where GM factory is closing

South Korea has designated the city of Gunsan an ‘industrial crisis zone’, extending its support for the area after plans by General Motors to close a plant as well as the shut down of a shipyard last year.

The new designation gives broader financial support to employees and businesses, and is one notch above its former designation given in February of a ‘crisis zone for industry and employment’ which concentrated on measures to tackle unemployment.

It was the first time that the new designation has been used after the category was first introduced in June 2017, the trade ministry stated.

The move comes on top of central bank prepares to grant 40 billion won ($38 million) in aid to mid-to-small sized companies that have been impacted by the planned shutdown of the automaker’s plant.

The government has also stated it would offer about 240 billion Korean won in loan guarantees and low-interest loans to regions impacted by corporate restructuring, consisting the Gunsan area.