The South Korean government has rolled out its economic blueprint for the next 6 months.
The ultimate goal is making the lives of ordinary people better in a way they can feel.
Our Lee Soo-jin starts us off.
The South Korean government plans in the second half of the year to focus on improving the lives of vulnerable groups as it aims to continue its economic growth momentum.
The Finance Ministry on Wednesday announced its economic policy direction for the latter half of the year where it revised its economic growth projection from 2-point-2 percent to 2-point-6 percent for 2024.
This upward revision was mostly due to a strong growth forecast for exports thanks to increased demand for AI as well as semiconductors.
And inflation rate for this year is expected to ease to 2-point-6 percent.
This comes as data from Statistics Korea on Tuesday showed that the consumer price index – a key gauge of inflation – rose by 2-point-4 percent in June compared to the same month the year before.
This is the lowest figure seen in 11 months – inching closer to the target inflation of two percent.
But the government, which typically bases the direction of its economic policies on these projections, said that while the newly revised projections are promising, vulnerable groups are yet to feel that the economy is getting better.
“But because the recovery speed varies across sectors due to high inflation and interest rates, small business owners still feel that the economy is struggling.”
To help small business owners, the government will spend 25 trillion won, or nearly 18 billion U.S. dollars, to provide financial support, business growth and recovery opportunities as well as a “one-stop platform” that allows them to more easily access necessary information.
According to one expert, the most helpful policy is likely to be the measures that are targeted towards easing the burden of high interest rates.
“I think the most effective way is postponing interest rate payments to banks. In terms of the moral hazard problem, it is very difficult to decrease the size of money borrowed from banks but instead there is small room for banks and medium and small sized businesses to delay interest rate payment.”
The government will also help small business owners expand digitally to accelerate their growth and provide incentives for those who wish to start new businesses.
Lee Soo-jin, Arirang News.
Source : Arirang TV, https://www.arirang.com/news/view?id=272809
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