Korean Government Extols Early Budget Execution Plan

by Mary Swire, Tax-News.com, Hong Kong

17 March 2009

The Korean government has announced details of its early budget execution plan.

According to officials at the country's Ministry of Strategy and Finance, at the end of February this year, the government had spent KRW60 trillion, (USD41bn) which is equivalent to 23.3% of the total annual budget (KRW257.7 trillion).

This amount represents an excess of KRW13.3 trillion (USD9bn) over the original budget allotted for the months of January and February.

Further explaining the government's announcement, Vice Finance Minister Lee Yong-Geol said, “Early budget execution is more important than ever because it can help alleviate the economic hardship of the nation through creating new jobs and bringing stability to people’s livelihood”.

In particular, the government has spent KRW21.8 trillion (USD15bn) on several key areas. These key areas include, but are not limited to, bringing stability to financial markets, supporting low income families’ livelihoods, creating new jobs and providing job training.

A total of KRW75.1 trillion (USD52bn) was allocated for these key programs in 2009.

As part of an effort to boost the viability of SMEs and prop up the domestic economy, the government plans to frontload KRW45.8 trillion (USD31bn) in the first half of this year.

Meanwhile, the government announcement states that it has tried to "reform ten challenging issues, such as improving effectiveness of budgeting and accounting systems, streamlining construction contract procedures, and offering advance payments to construction companies to promote early budget execution."

The early budget execution has proceeded to schedule, and the government says that it will continue making efforts to boost the sluggish economy.

It is thought that the government will release detailed guidelines regarding the execution plan of the supplementary budget immediately upon securing parliamentary approval.

Recommended