Supplemental budget finally passes assemblyThe 17.3 trillion won ($15.8 billion) supplemental budget passed the National Assembly yesterday, adding muscle to the government’s pro-growth strategy.
Among the 226 lawmakers, 130 voted for the budget while 69 cast votes against it. Twenty-seven lawmakers gave up their votes.
The supplemental passed the National Assembly not long after a subcommittee of the Special Committee on Budget and Accounts sent the budget plan to the main floor earlier in the day.
It has been 20 days since the ministry sent the bill to lawmakers.
The Ministry of Strategy and Finance has been strongly urging the lawmakers to pass the budget.
Last week, Hyun Oh-seok, deputy prime minister for economy and finance minister, issued a statement calling for immediate action to pass the pending budget bill.
Hyun said in the statement the economy will not be able to recover without the supplemental budget. The ministry wanted the plan passed by early May.
The Finance Ministry under stewardship of the deputy prime minister has announced strong measures to boost the economy, such as the April 1 real estate normalization plan and May 1 investment promotion plan.
However, the plans will be ineffective without passage of the additional budget.
“The economy continues growing less than 1 percent quarterly due to decreasing investments and exports amid persisting global uncertainties such as the weak yen, U.S. debt ceiling negotiations and slow recovery in the euro zone,” the Finance Ministry report said.
Major economic indicators show poor performances, the report said.
The number of newly employed people stayed in the 200,000 range in February and March, down from the average of 400,000 last year.
The mining and manufacturing industry saw total production decline 2.5 percent in March from a month earlier.
In April, the country’s exports grew by a mere 0.4 percent, despite increases in the number of working days that month. The average daily exports stood at $1.9 billion during the month, plunging by nearly 8 percent compared to a year earlier.
The ministry said overall exports shrank because of fiercer competition with Japanese automobiles and steel products taking advantage of the weak yen.
Adding to the woes, retail sales are expected to decline in April compared to March, the ministry said.
“Given that sales of department stores and discount stores have fallen significantly, private consumption is likely to remain stagnant,” the report said.
“A primary goal of the government is to make growth reach 1 percent at least in the second half of the year,” said Lee Hyung-il, an economist at the ministry.
By Song Su-hyun [firstname.lastname@example.org]