S. Korea to front-load fiscal spending next year

SEOUL, Dec. 4 (Yonhap) -- South Korea said Thursday that it will front-load
fiscal spending in the first half of next year as part of efforts to stimulate
the fast-slowing economy.
The Ministry of Strategy and Finance said that it aims to use 60 percent of
spending during the January-June period to push for government-led business
projects, including infrastructure construction.
This year, 220 trillion won (US$14.94 billion) was set aside for such purposes
and the amount will likely grow to 240 trillion won for next year, a ministry
official said.
The exact amount, however, will be determined after government agencies and
ministries finalize their business plans. A delayed approval of the 2009 state
budget plan could affect the overall process, he added.
Earlier last month, the ministry submitted the 284 trillion won state budget
proposal to the National Assembly for approval but parties are wrangling over the
scope of tax cuts and expenditure plans. They missed the Dec. 2 legal deadline
for its passage.
The budget proposal was based on forecasted economic growth of 4-percent, but
many view the figure as overly optimistic. Some foreign investment banks predict
an economic contraction next year for the first time in 11 years as demand for
Korean-made goods could decline sharply amid a worldwide recession.
kokobj@yna.co.kr
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