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South Korea to spend $95 bln on green projects to boost economy

Electric vehicles, hydrogen cars will have a key role in the plan.

The plan is expected to create nearly 2 million jobs through 2025.

SEOUL: South Korea outlined a plan on Tuesday to spend 114.1 trillion won ($94.6 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 fifth-generation (5G) wireless networks, and tax breaks for telecoms providers who install the systems.

First proposed by Moon’s ruling party ahead of the parliamentary election in April, the plan set 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 plan is a half-baked deal that lacks the goal of curbing carbon emissions to net zero by 2050 and a roadmap to reach that,” Greenpeace Korea said in a statement.

Electric and Hydrogen-Powered Cars

A lawmaker helping to draft the legislation, Lee So-young, defended the lack of a nationwide timeline to phase out vehicles with internal combustion engines, saying it could be challenging for major auto exporters such as South Korea to adopt one.

“It’s easier for auto-import oriented countries like the United Kingdom to set a timeline,” she said.

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