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(LEAD) Moon urges more active fiscal policy for growth, welfare

Politics 17:46 May 16, 2019

(ATTN: UPDATES with finance minister's remarks in last 3 paras; ADDS photo)

SEOUL, May 16 (Yonhap) -- President Moon Jae-in called Thursday for an aggressive fiscal policy to cope effectively with a slew of "structural" problems in South Korea.

He pointed out that Asia's fourth-largest economy is ridden with such pressing concerns as a widening income gap, unemployment, aging society and low childbirth rate.

"It's a time when the bold role of state finance is more necessary than any other time," the president said during a government meeting on fiscal strategies in the administrative town of Sejong, some 160 kilometers south of Seoul. Present were Cabinet members, government officials and senior ruling party lawmakers.

President Moon Jae-in speaks at a meeting of Cabinet members and ruling Democratic Party lawmakers on fiscal strategies in Sejong, some 160 kilometers south of Seoul, on May 16, 2019. (Yonhap)

The annual session was intended for far-reaching discussions on the direction of the country's fiscal policy.

Moon emphasized that South Korea will have to pay a bigger price unless it handles the current problems actively and thoroughly.

He said his administration has initiated a drive toward an "innovative, inclusive" nation over the past two years.

Its signature economic reform measures include the income-led growth strategy, the introduction of a 52-hour workweek system and support for small and medium-sized firms as well as efforts to phase out nuclear energy use.

"Now is time to step on the accelerator pedal," he stressed, instructing government officials to step up efforts for concrete accomplishments from new policies. His five-year tenure ends in May 2022.

In particular, the president said, it's "painful" to see the difficulties of the self-employed and people in the low-income bracket.

"In that sense, I earnestly ask the National Assembly to normalize its operation and discuss the government's extra budget bill at an early date," he said. "In case of supplementary budgets, 'timing' and 'speed' are very important."

The government has proposed 6.7 trillion-won (US$5.8 billion) supplementary budgets for use in various projects, which include those to revitalize the economy, tackle air pollution and recover from a recent wildfire in Gangwon Province.

President Moon Jae-in speaks at a meeting of Cabinet members and ruling Democratic Party lawmakers on fiscal strategies in Sejong, some 160 kilometers south of Seoul, on May 16, 2019. (Yonhap)

In the closed-door session that followed Moon's opening remarks, Hong Nam-ki, the minister of economy and finance, briefed Moon on plans to maintain an expansionary fiscal policy, according to Cheong Wa Dae spokesperson, Ko Min-jung.

Hong reported to the president that the economy team would place top priority on helping low-income workers increase their earnings, as well as on creating jobs, reducing fine dust and expanding R&D investment for innovative growth.

It would also focus on supporting a couple of key diplomatic initiatives -- the New Southern Policy and New Northern Policy -- as part of efforts to diversify trade and on facilitating the implementation of inter-Korean summit agreements, the minister was quoted as adding.

lcd@yna.co.kr
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