SEJONG, South Korea Aug 12 South Korea will
double the daily price movement limit on stocks listed on the
main board for the first time in nearly 16 years, in new
measures the government unveiled on Tuesday to boost service
Each stock listed on the Korea Exchange will be allowed to
rise or fall by up to 30 percent from its previous closing
price, compared with 15 percent at present, the government said
in a joint statement from six ministries and one agency.
Officials at the Financial Services Commission, which is
mainly in charge of changing the limit, said the timing would be
confirmed as soon as possible after further discussions with
academics and market participants.
The government said it hopes this and other measures
unveiled on Tuesday will lift the contribution from the
financial sector to 8.0 percent of the national total in 2017,
from 6.7 percent recorded in 2012.
It would be the first change of the price movement limit
since late 1998, when it was expanded from 12 percent during the
height of a financial crisis, to make financial markets more
capable of reflecting changing conditions.
In addition to the financial sector, the government also
selected six business areas for especially strong support -
health and medical, tourism and cultural content, education,
logistics and software.
The new measures follow economic stimulus policy plans the
government introduced late last month to jumpstart faltering
domestic demand, including $11 billion in additional public
spending and an easing of mortgage rules.
Finance Minister Choi Kyung-hwan, who took office less than
a month ago, has spearheaded an economic revival campaign to
prevent what is feared could become a severe slump similar to
Japan's two decades of deflation.
The finance ministry expects South Korea's economic growth
to accelerate to 3.7 percent this year from 3.0 percent last
year but is worried that downside severe risks remain while
domestic demand is shrinking.
The government said the new measures announced on Tuesday
would result in about 15 trillion won ($14.6 billion) of
investment flowing into domestic industries and the creation of
about 180,000 jobs over the next three years.
The plans announced on Tuesday are anticipated to bring
about investment of 15 trillion won and create roughly 180,000
jobs in the next three years, the finance ministry said in a
(1 US dollar = 1,030.3000 Korean won)
(Reporting by Christine Kim; Editing by Choonsik Yoo and Eric