Lee orders review of S. Korea's fiscal condition

SEOUL, Feb. 11 (Yonhap) -- South Korean President Lee Myung-bak on Thursday
ordered a review of the country's fiscal condition and the financial health of
public firms, as concerns mounted over state debt crises in Greece and other
European nations.

"We need to use this case (in Europe) to institutionally make up for the
vulnerability of our economy," Lee said at a weekly economic policy meeting.
This week's session was held at an underground bunker at the presidential office
Cheong Wa Dae. One of the main agenda items was how to cushion the impact from
the mounting budget deficits in Greece, Portugal and a few other nations in
Europe, according to Cheong Wa Dae officials.
Lee was briefed by the state-run Korea Institute for International Economic
Policy (KIEP) on the crisis in Europe and had discussions with his economic
advisors on contingency plans, Cheong Wa Dae spokeswoman Kim Eun-hye said.
South Korea's government debt rose to about 360 trillion won (US$318 billion)
last year from 93.6 trillion won a decade earlier, accounting for 34 percent of
its gross domestic product (GDP), according to the finance ministry.
Combined debts at state-funded companies and other institutions are also
estimated to have increased to 377 trillion won in 2009 from 320 trillion won in
2008.
The president stressed it is an international standard to exclude public firms'
debts from the official government debt data.
"The government needs to step up efforts to correct misunderstanding that public
companies' debts are included in state debts," Lee said. "At the same time, the
government should carefully review the possibility of bad management in public
firms."
lcd@yna.co.kr
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