Gov"t Announces 5 Year Finance Plan

The Budget Planning Committee (BPC) announced a five year finance plan for 1998 through to 2002 made by the Korea Development Institute (KDI) on October 15. The BPC plans to report to the State Council in December.
According to this report, although the economy will recover from 1999 and a retrenchment policy can be maintained, government finances will not be balanced until 2006. The government is predicted to pay back all national bonds in 2015. It will issue 11.7 trillion won in national bonds to compensate for financial shortages this year. The total sum of national bonds is predicted to reach 75.5 trillion won in 2005.
KDI emphasized that the government should maintain an annual expenditure increase rate of on average 5.55% and should reduce expenditures in national defense, education, and agriculture. KDI also proposed that expenditures in health, social welfare, and social overhead capital should be increased but that small and medium sized companies, education, fishery and agriculture should be decreased.