Yun Ho-jung says second batch of supplementary budgets will drive economic recovery

The ruling party voiced that the second batch of supplementary budgets is needed for economic recovery after COVID-19.

“The party, the government, and the presidential office discussed fiscal management at the national financial strategy meeting on Thursday,” said Yun Ho-jung, the floor leader of the Democratic Party of Korea, at a Supreme Council meeting on Friday. “As people’s daily lives and economic activities resume with smooth COVID-19 vaccination and the relaxation of social distancing guidelines, the second batch of supplementary budgets will be a powerful driving force behind economic recovery.” The government set supplementary budgets of 14.9 trillion won in March to support small business owners and those struggling to find a job.

“The South Korean economy has been doing relatively well even amid the crisis of COVID-19, largely thanks to national finance,” said Yun. “We are looking forward to the government’s inclusive and expansive fiscal policy not only next year but also the second half of the year.” Meanwhile, President Moon Jae-in said at the national financial strategy meeting that it is necessary to maintain the expansive fiscal stance to ensure meaningful economic growth and reduce gaps caused by COVID-19 at least until the next year even though there are two conflicting sides of asking for expansive fiscal stance and emphasis on fiscal soundness.

As the ruling party and the government both emphasize expansive fiscal policy, the Ministry of Economy and Finance is leaning toward setting supplementary budgets. “A faster, stronger recovery is needed for the South Korean economy to return to its normal growth trajectory,” said the first vice minister of the ministry on supplementary budgets at a briefing after a meeting of the central response center for economic emergency held at Government Complex Seoul on Friday. “During the course of the pandemic, the damage has been concentrated on those with low income and in vulnerable situations, which has continued economic challenges of the working class.”


Sang-Jun Han alwaysj@donga.com