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(LEAD) IMF welcomes S. Korea's extra budget: finance ministry

Economy 11:36 April 13, 2019

(ATTN: UPDATES with view of Group of 20 finance ministers and central bank governors)

WASHINGTON, April 12 (Yonhap) -- The head of the International Monetary Fund hailed South Korea's plan to draw up an extra budget, South Korea's finance ministry said Friday.

IMF Managing Director Christine Lagarde said an extra budget is a policy direction that meets the international lender's recommendations. She made the comments in a meeting with South Korean Finance Minister Hong Nam-ki on the sidelines of the spring meetings of the IMF and World Bank in Washington, according to the ministry.

South Korean Finance Minister Hong Nam-ki (L) shakes hands with IMF Managing Director Christine Lagarde on April 12, 2019, on the sidelines of the spring meetings of the IMF and World Bank in Washington. This photo was provided by the Ministry of Economy and Finance. (Yonhap)

Hong told Lagarde that South Korea is working on an extra budget to preemptively counter downside risks.

Earlier this week, Hong said in Seoul that he expects to introduce a supplementary budget worth less than 7 trillion won (US$6.1 billion) to boost domestic demand and create jobs. The extra budget is also meant to cope with fine dust air pollution.

The South Korean government is set to submit an extra budget bill to the National Assembly later this month for approval.

Last year, South Korea's parliament approved an extra budget bill worth 3.83 trillion won to create jobs for young people and help industrial regions grappling with massive layoffs.

Separately, the Group of 20 finance ministers and central bank governors held a two-day meeting and called for expansionary monetary and fiscal policy as well as structural reforms to boost a slowing global economy.

They said the global growth momentum could improve in the second half of this year.

Earlier this week, the IMF kept its 2019 growth outlook for South Korea unchanged at 2.6 percent while slashing its growth forecast for the global economy this year to 3.3 percent from its previous outlook of 3.7 percent released in October.
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