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Gov¡¯t announces follow-up measures to restructuring

Posted November. 03, 2000 19:48,   


The government has decided to introduce a ¡®direct-payment¡¯ system in which agencies placing orders for public projects will be required to pay fees to subcontractors if construction companies ordered to leave the market are allowed to continue with the ventures.

In addition, for companies hiring employees of exited companies, the government will offer financial assistance amounting to 35 to 50 percent of their wages for six months.

The government announced this and other measures related to finance, construction and employment Friday in a follow-up move to corporate restructuring, in which it announced a list of companies to be forced out of business.

Officials explained that the measures are designed to minimize the possible aftereffects of restructuring such as uneasiness in financial markets and contraction of the real economy.

The measures call for financial institutions to offer additional funds and convert commercial bills issued by exited companies into loans for subcontractors and not to hold employees of financial institutions responsible for the results of the lending.

For citizens scheduled to move in to apartments under construction by exited firms that are deemed no longer able to continue the work, the government plans to have the Korea Housing Guarantee select other builders and let them carry on with the projects.