Finance minister calls for swift passage of extra budget bill

South Korea's finance minister on Tuesday called on parliament to quickly pass the extra budget bill to invigorate the economy, which has been in the doldrums amid faltering exports and slowing domestic demand.

"This is the right time for South Korea to revive momentum for an economic recovery," Finance Minister Yoo Il-ho said in a press conference in Seoul with other economy-related ministers, including Trade Minister Joo Hyung-hwan. "An extra budget bill will have less effect if we miss out on the right timing to execute the fiscal program."

The government announced a plan to draw up an 11 trillion-won (US$9.92 billion) supplementary budget last month to take aggressive fiscal policies to boost Asia's fourth-largest economy, which has been suffering from 19 consecutive months of export decline.

The country's domestic side remained in a relatively better position as retail sales rose 9 percent in June on the back of the government-led excise tax cut program on passenger cars. But the end of the excise tax benefit program weighed heavily on domestic consumption as car sales fell 10.5 percent on-year in July.

The extra budget bill, which needs parliamentary approval to take effect, was submitted to the National Assembly late last month and scheduled to be approved by Aug. 12.

But opposition parties have refused to follow the government-proposed schedule, saying that the government should deal with other political issues, such as the planned deployment of an advanced U.S. antimissile system to South Korea, or THAAD.

Minister Yoo said the ongoing corporate restructuring in the local shipbuilding industry will weigh heavily on the job market and the entire economy as tens of thousands of layoffs will be caused by downsizing efforts of major shipbuilders, including No. 1 Hyundai Heavy Industries Co.

He noted that the supplementary budget also includes a comprehensive plan to assist the regions where major shipyards are located.

The unemployment rate in Ulsan, where the country's No. 1 shipyard Hyundai Heavy Industries Co. is headquartered, gained 0.4 percentage point on-year to 3.6 percent in June, while South Gyeongsang Province, where other major shipbuilders are located, saw its rate soar 1 percentage point to 3.9 percent. Over the same period, the country's unemployment rate stood at an average 3.6 percent. (Yonhap)