FIRMS EXPERIENCE SETBACKS DUE TO VIRUS

[Anchor Lead]

South Korean firms are bearing the brunt of the continued spread of the new coronavirus. Chinese factories have reopened and some Korean auto plants have also resumed operation, but it will take time until full normalization.

[Pkg]

This is Kia plant in Gwangmyeong City where the carmaker's flagship models are manufactured. It produces an average of one thousand units per day, but it has suspended operation due to a lack of wiring harnesses - a component imported from China. The suspension was initially until Tuesday but it's been extended by two more days. Normally over 5,000 workers would be hard at work at this time but assembly lines have all stopped with very few people on site. Fortunately many Chinese factories have reopened and auto parts are again trickling into Korea, and plants are reopening. Hyundai and Kia partially resumed factory operations from Tuesday, while SsangYong and Renault Samsung will resume operations from Thursday and next Monday, respectively. However, it's still early to predict a full normalization. Only half the employees at the 37 Chines auto parts plants that reopened came to work on Monday. Restrictions on movement and public transport is another variable. This is causing concern for auto-related subcontractors, most of which are small or medium-sized firms. It's not only manufacturing. Recovery in the lodging and food industries is also hard to predict. SMEs forecast the fallout from the coronavirus outbreak can last anywhere between a month and 6 months. As well as domestic production, exports are also at risk, causing a headache for the government.

[Soundbite] CHUNG SYE-KYUN(PRIME MINISTER) : "Once auto parts are produced in China, customs procedures will be quickened so they can swiftly reach Korea."

On Wednesday, the government will announce support measures for SMEs and small business owners that have taken a hit from the outbreak.