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Economy

K-New Deal: South Korea to invest $133bn in digital, green sectors

President Moon Jae-in aims to create 1.9 million jobs by 2025

South Korean President Moon Jae-in said Tuesday the "K-New Deal" will be the starting point for the country to lead the post-coronavirus world.   © Kyodo

SEOUL -- South Korea on Tuesday unveiled $133 billion of post-coronavirus spending in what President Moon Jae-in called a "K-New Deal," echoing the term used by U.S. President Franklin Roosevelt for the programs to pull his country out of the Great Depression in the 1930s.

Under the plan, South Korea will invest 160 trillion won ($133 billion) to create 1.9 million jobs by 2025 in the digital and green sectors.

Moon said Tuesday that the initiative will be the starting point for the country to lead the post-coronavirus world with its advanced technology and efficient medical infrastructure. He praised the country's measures to contain COVID-19 -- daily local cases tend to be under 30.

"The K-New Deal is the architect to design the Republic of Korea's new century," Moon said in a speech. "With the two pillars of a digital new deal and a green new deal, we will move ahead as a leading country riding the wave in the world history."

The pandemic has battered South Korea's export-reliant economy. In June, the country's shipments overseas dropped 10.9% to $39.2 billion from a year earlier, although the fall was narrower than the previous month's 23.6%. The nation's economy contracted 1.3% in the first quarter.

The government selected 10 key projects for the digital and green economy. One is a "data dam," which aims to establish infrastructure for collecting and trading big data for use in finance, environment and transportation services. Other programs include artificial intelligence government, green energy and eco-friendly future mobility.

The government also plans to establish large-scale onshore wind power complexes, and is looking at up to 13 candidate locations. For the eco-friendly future mobility project, the government aims to increase sales of electric vehicles by 1.1 million units over the next five years.

But environment activists are disappointed with the plan, saying the government is doing things by halves. They have accused the administration of being a climate villain for investing in overseas coal power projects.

"To stop the climate crisis, the government should cut carbon emissions to half of the current level by 2030 as well as make it net-zero by 2050. With no plan and road map for this, the plan is just half of a green new deal," said Justin Jeong, a campaigner at Greenpeace.

South Korea is not the only country talking about "new deals."

Late last month, U.K. Prime Minister Boris Johnson unveiled his version of Roosevelt's program. He promised to "build build build" in setting out plans to accelerate 5 billion pounds ($6.3 billion) of spending on infrastructure projects.

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