S. Korea`s fiscal soundness to rank 5th among major economies: IMF

SEOUL, May 4 (Yonhap) -- South Korea's fiscal soundness will rank fifth among
Group of 20 (G20) major advanced and developing countries this year despite its
ongoing efforts to stimulate the sagging economy through tax cuts and additional
spending, a report showed Monday.
According to the report by the International Monetary Fund (IMF), South Korea's
fiscal deficit will account for 3.2 percent of gross domestic product (GDP) this
year, less than half the average 6.6 percent of G20 countries.
India will see its deficit account for 10.2 percent of GDP this year, while
Britain, Japan and the United States will likely post 9.8 percent, 9.4 percent
and 9.1 percent, respectively, the report showed.
Of the 20 countries, Brazil, Australia, Indonesia and South Africa were the only
nations the IMF forecast to post deficits less than South Korea.
The Seoul government joined global efforts to overcome an economic crisis with
diverse tax cuts, additional fiscal spending and other pump-priming measures as
the global recession dents demand for Korean goods at home and abroad.
Last month, the parliament passed a 28.4 trillion won extra budget, helping to
speed up the government's bid to revive the sagging economy. The additional
spending, to be secured primarily through debt sales, raised concerns it could
hurt the nation's fiscal soundness.
South Korea's economy, Asia's fourth-largest, will likely shrink 2.4 percent this
year, the first negative growth in more than a decade, according to the latest
prediction by the central bank.
The IMF predicted that South Korea's fiscal deficit to GDP will grow to 4.7
percent in 2010 but it is still lower than 6.5 percent that it forecast for all
G20 countries.
kokobj@yna.co.kr
(END)