Finance minister calls on parliament to approve record budget proposal

Published : Nov 27, 2018 - 13:54 Updated : Nov 27, 2018 - 13:54

South Korea's chief economic policymaker on Tuesday urged parliament to approve a record budget proposal for 2019, stressing that passing it is necessary to help resolve chronic problems, such as the low birthrate and dismal job conditions.

The National Assembly's review of the government's 2019 budget proposal hit a snag as rival parties sparred over an estimated shortfall in tax revenue at a meeting of the subpanel on the budget.

Finance Minister Kim Dong-yeon (R) speaks with Kim Sung-tae, the floor leader of the main opposition Liberty Korea Party, during a meeting at the National Assembly on Nov. 13, 2018, in this file photo. (Yonhap)

The legal deadline to review the government's record 470.5 trillion-won ($416.5 billion) budget bill is Sunday.

"The tax revenue shortfall is due to spending for low-income earners, and the parliamentary deadlock is not desirable," Finance Minister Kim Dong-yeon told reporters before heading to Britain and Argentina where the annual Group of 20 summit will be held later this week.

The government budget proposal for next year calls for a 9.7 percent on-year rise in spending, marking the fastest increase since 2009, when outlays jumped 10.6 percent in the aftermath of the 2008 global financial crisis.

Next year's budget spending also heralds a greater fiscal role in Asia's fourth-largest economy, where exports remain sound, but private spending is showing signs of a slowdown.

The expansionary fiscal policy, among other things, is clearly aimed at boosting jobs. Under the proposal, some 23.5 trillion won will be spent on job creation schemes alone.

Poorer-than-expected jobs data is a hard blow to President Moon Jae-in, whose top economic agenda is to create more quality jobs.

The largest bulk of the 2019 budget will go to the health, welfare and labor sectors, with the total allocated hitting a record 162.2 trillion won. (Yonhap)