The number of small businesses shutting down on South Korea’s Jeju Island has increased significantly in recent years. (Image courtesy of Yonhap)
SEOUL, Jul. 25 (Korea Bizwire) – The number of small businesses shutting down on South Korea’s Jeju Island has increased significantly in recent years, according to local authorities.
Data from the Jeju Credit Guarantee Foundation shows a steady uptick in business closures among its clients: 1,706 in 2023, 965 in 2022, 723 in 2021, and 618 in 2020. This represents a 176% increase in closures over three years compared to 2020 levels. The trend has continued in 2024, with 963 businesses having closed by June.
A Jeju provincial official explained, “Many businesses that were struggling with operating losses are now closing down as government support for small business owners has decreased post-COVID-19, and loan maturities are approaching.”
In response, the Jeju provincial government is offering support through programs such as bridge guarantees, which help business owners manage maturing loans, and special guarantees for those attempting to restart their businesses.
The bridge guarantee program is available to Jeju Credit Guarantee Foundation users whose businesses have closed and who either fall in the bottom 5% of individual credit scores or have an annual income of 80 million won or less.
The special guarantee for business restarts targets those reopening after closure, resuming operations after a hiatus, or switching industries.
Kim In-young, head of Jeju’s Economic Vitality Bureau, stated, “We will implement multifaceted measures to reduce the debt repayment burden on small business owners and support their opportunities for a fresh start.”
According to Statistics Korea, small businesses account for 95.4% of all enterprises on Jeju Island, totaling 119,126 out of 124,877 companies.
M. H. Lee (mhlee@koreabizwire.com)
