Korea to accelerate spending to boost growth: ministry

The government plans to make certain that the state budget earmarked for use in the second half will be spent in a timely manner to bolster economic growth, the Finance Ministry said Monday.

In a budget review meeting chaired by Vice Finance Minister Kim Dong-yeon, Seoul said it will do its best to inject money into projects in the coming months without delay.

“The goal is to reduce the size of funds that are carried over into next year or not used at all because of various obstacles,” the senior official said.

Earlier in the year, the ministry said that 60 percent of this year’s spending plan of 276.8 trillion won ($238 billion) will be used up by June, with the rest of the money to be injected into the market from July through December.

The plan covers spending by both the central and regional governments.

On average, about 5 percent of the budget or about 13 trillion to 15 trillion won is not used and carried over into the following year.

The stance comes as persistent eurozone woes and sluggish growth in the United States and China have started exerting negative influence on economic growth.

Getting money into the economy could help strengthen the nation’s overall economic health and vitality.

Asia’s fourth-largest economy grew 2.8 percent on-year in the first three months, which is slower than the 3.7 percent growth annual target set by the government. In 2011, the country’s growth came to 3.6 percent, down sharply from 6.2 percent in the previous year.

Kim said that government ministries will be charged with keeping close tabs on how the budget is being spent and to deal with any bottlenecks that may arise.

The official, meanwhile, said that it is critical that the government is successful in front-loading 60 percent of the budget in the first half.

As of the end of May, the government spent 135.4 trillion won or 48.9 percent of the total, which should allow it to meet its first half target. 

(Yonhap News)