The government will create a new program to supply liquidity to small and medium sized enterprises as measures on extending loan deadlines are due to expire in March.

Outlining economic policy directions for 2022 on Monday, the government said the Korea Development Bank(KDB) will establish a two trillion won fund for this purpose. It will also assist SMEs to improve and adjust their debt structure based on credit rating and repayment ability.

A previously announced government aid package of four trillion won will also go towards providing operational funds for small firms and allowing them to pay off loans in installments over the long term.

The government's COVID-19 response program will be cut from 34 trillion won this year to seven trillion won next year, but it will provide a similar level in total policy financing to the tune of 495 trillion won next year as well. 

The government also plans to suppress household debt growth, keeping it in the four to five percent range.