S. Korea posts fiscal deficit of 8.5 tln won in Jan.

SEOUL, May 9 (Yonhap) -- South Korea's budget deficit climbed above eight
trillion won (US$6.4 billion) in January as the country struggled to stimulate
its sluggish economy by increasing state spending, the finance ministry said
Saturday.
According to the ministry, the fiscal deficit reached 8.54 trillion won for the
first month of the year.
The government expects to register a fiscal deficit of 22 trillion won for the
full-year of 2009 after it passed an extra budget of 28.4 trillion won in a bid
to spark an economic recovery.
"The widening fiscal shortfall followed the government's aggressive budget
front-loading in January," a ministry official said. "The deficit level is in
line with government expectations."
The government is cutting taxes and increasing other pump-priming measures as
part of its efforts to bolster the sagging economy.
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.
pbr@yna.co.kr
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