Minister of Strategy and Finance Hyun Oh-seok announced that the government decided to expand its spending for the first half of the year at an economic ministerial meeting at the Government Complex Seoul on April 16. The government decided to augment its spending 55 percent for the first half year of 2014.
Therefore, the first half year’s spending will rise from the original 161.5 trillion to 165-170 trillion won (US$159-163 billion).
On the same day Hyun Oh-seok, deputy prime minister and minister of strategy and finance, said at the aforementioned meeting, “We will expand second quarter spending so that the first half year’s spending will exceed the original goal by 55 percent.”
He added, “We need to step up the effort since the private sector investment is not in strong recovery and consumer sentiment is low. We plan to focus on supporting small and medium-sized enterprises in the second quarter, so that 60 percent of the spending will be executed in the first year.”
The minister stressed, “Our supreme goal is to make the public feel the quality of their lives is getting better, such as an increase in employment, so we will beef up policy measures so that economic recovery will gain momentum.”
However, the problem with the government’s plan is that it is lacking financial capabilities, since tax revenues in January and February are lagging behind, only meeting 14.4 percent of the annual tax revenue goal.
The minister of strategy and finance is considering measures such as utilizing available funds from National Pension Funds or moving up the schedule for implementing projects for public organizations from the second half of the year.
The minister said, “To boost Korea’s tourism, we need to expand tourist accommodations and facilities and foster the resort complex industry, and this calls for a discussion on a possible overhaul of the tourism promotion act, to ease regulations on building tourist hotels.”