S. Korea to boost spending

S. Korea to boost spending

SEOUL (DPA): South Korea plans to up state spending by six trillion won (US$4.6 billion) to stimulate its battered economy and support the growing number of people without jobs, a supplementary proposal from the Seoul government published yesterday said.

The finance ministry plan calls for an increase in this year's budget deficit to around four percent of gross domestic product or up to 17.5 trillion won.

This would be the largest budget deficit since 1981 when it reached 4.7 percent.

The plan would need ratification by the International Monetary Fund (IMF), a budget department spokesman in Seoul said. Raising the budget deficit is one of the themes being discussed between Seoul and a delegation form the IMF. At the end of April the two sides had agreed on a 1.7 percent deficit to boost flagging domestic demand.