South Korea to spend $132b on green projects

SEOUL • South Korea yesterday outlined a plan to spend 114.1 trillion won (S$132 billion) on a "New Deal" to create jobs and help the economy recover from the coronavirus fallout, anchored in part by "green" investment in electric vehicles and hydrogen cars.

The six-year plan will build digital infrastructure and a stronger safety net for job seekers, but its "Green New Deal" aspects have drawn attention as they aim to cut heavy reliance on fossil fuels in Asia's fourth-largest economy.

"The coronavirus pandemic once again reaffirmed the urgency of responses to climate change," President Moon Jae-in said in a speech, adding that the new projects were expected to create about 1.9 million jobs through 2025.

The plan envisages investment in smart grids to manage electricity use more efficiently, promotion of remote medical services, a work-from-home policy for businesses and online schools based on 5G wireless networks, and tax breaks for telecoms providers which install the systems.

First proposed by Mr Moon's ruling party ahead of the parliamentary election in April, the plan sets ambitious goals of net-zero emissions by 2050, an end to funding of overseas coal plants, and introduction of a carbon tax.

But environmental groups criticised the initiatives as light on measures to rein in emissions.

"This is a half-baked (plan) that lacks the goal of curbing carbon emissions to net zero by 2050 and a road map to reach that," Greenpeace Korea said in a statement.

Lawmaker Lee So-young, who is helping to draft the legislation, defended the lack of a timeline to phase out vehicles with internal combustion engines, saying it could be challenging for major auto exporters like South Korea to adopt one: "It's easier for auto-import oriented countries like the United Kingdom to set a timeline."

South Korea aims to have 1.13 million electric vehicles (EVs) and 200,000 hydrogen cars on the roads by 2025, up from 91,000 and 5,000 each by the end of 2019, Mr Moon said, while the government would add more charging stations for the vehicles.

Hyundai Motor leader Euisun Chung said the flagship company and sibling Kia Motors aim to sell one million EVs in 2025, together targeting more than a tenth of global market share.

He said Hyundai Motor also plans to launch a next-generation electric vehicle with a range of 450km for every charge, which will take 20 minutes or less.

It aims to export 1,600 hydrogen-powered trucks to Europe by 2025, and develop a new system that doubles battery life at half the price, he said. That system will suit ships, trains, aircraft, buildings, power plants and military purposes.

Last week, Seoul said it would invest 2.6 trillion won in its own version of the green deal, and set a 2035 deadline to stop registration of vehicles with internal combustion engines. It also vowed to convert 4,000 of its fleet of 7,396 public buses to electric or hydrogen power by 2025, and give more conversion incentives for new taxis.

Seoul also plans 4,000 charging stations for EVs and 65 for hydrogen-powered cars by 2035, up from 1,090 stations for EVs and four for such cars now.

REUTERS