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South Korea's chief economic policymaker said Monday that a series of measures aimed at boosting corporate spending will continue without interruption, expressing concerns that facility investment is in dire straits amid economic uncertainties.
"Corporate investment-boosting measures will not be a one-off event, and should be pursued consistently down the road," South Korean Finance Minister Hyun Oh-seok said during a meeting with economy-related ministers.
The minister said the government will continue corporate deregulation as part of a move to boost corporate spending, adding the government will also unveil a set of measures next month to increase corporate spending.
"Corporate spending is very low, which could delay economic recovery and undermine growth potential," Hyun said.
South Korea's economy is showing signs of losing its momentum in the face of lingering uncertainty at home and abroad. The economy grew 2 percent in 2012, the slowest gain in three years.
The finance minister warned last week that the country's growth engine could cool off unless the government takes immediate action, underlining the sense of urgency among policymakers about the future of the economy.
Earlier this month, the government announced measures that include tax incentives aimed at stimulating the almost-frozen housing market.
Last week, it also drew up a 17.3 trillion won (US$15.5 billion) extra budget to kick-start the slowing economic recovery. Both are subject to approval by the National Assembly.
The proposed extra budget, if approved by the parliament, would be the second-largest after the 28.4 trillion won allocated in 2008 to tackle the unprecedented global financial crisis.
Source: Yonhap News (Apr. 29, 2013)