The Impact of the COVID-19 Pandemic on Korea’s Regional Economies

This paper estimates the impact of the COVID-19 pandemic-induced recession on Korea's regional economies. It finds that the recession has hit the island province of Jeju and the cities of Incheon and Ulsan the hardest, in that order. For Jeju in particular, it was estimated that the province’s real gross regional domestic product (GRDP) declined by 9% compared to the pre-pandemic trend, a figure 2.5 times greater than the estimated impact of the pandemic on nationwide GDP growth.The paper describes implications for policy carried by the analysis. It makes two key suggestions: the government could either work to strengthen support for the industries and subsectors in the deepest slumps, or provide direct support for economies in the hardest-hit regions.