Korea appears to be containing its COVID outbreak and one gold explorer is set to benefit
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As much of the world continues to grapple with the coronavirus, the world’s #2 economy China is ostensibly recovering. South Korea’s battle is far from over, but in recent days the number of new cases has plunged to lows not seen since the early stages of the crisis.
This led to tentative declarations that it has “flattened the curve”, led by WHO boss Tedros Adhanom Ghebreyesus. It has also seen schools and museums across the country gradually reopening.
What is most surprising about South Korea’s handling of the situation is that it did so initially without China’s heavy handed restrictions on movement. In addition, it confirmed its first case on the very same day as the US — January 20 — a country which is on the cusp of its own crisis.
There are not many ASX small caps with exposure to Korea but one is gold explorer Southern Gold (ASX:SAU).
The company has just raised $4 million which it claims will be enough to keep going for another 12 months. The company has continued its drilling campaign with its operations outside the major metropolitan areas.
Managing director Simon Mitchell told Stockhead he believed the worst of the situation in Korea was over.
“We’re drilling in Korea and it’s a better situation there than in Australia. We are able to operate there – the $4 million is enough to take us more than 12 months,” he said.
“If things got worse we could survive for some time – but our thinking is the global disruption is probably the next 2-3 months. In that scenario we would like to have maintained our momentum.
“The way the Koreans have managed it is probably a lesson for all countries, they locked it [society] down early and successfully and there is a culture well disposed for doing actions for the greater good.
“People will do what they’re told, if they think there’s a benefit for the greater good.”