South Korea's Lee Jae Myung urges approval of US$22.5 billion extra budget

CNA

6 hours ago

SEOUL: South Korea's President Lee Jae Myung on Thursday (Jun 26) called on parliament to approve a US$22.5 billion supplementary budget aimed at reviving the economy, in his first address to MPs since taking office.
Lee was elected in a snap vote this month following the impeachment of his predecessor, Yoon Suk Yeol, over his disastrous martial law declaration in December.
The new president's appeal comes as Asia's fourth-largest economy – heavily reliant on exports – reels from steep tariffs imposed by US President Donald Trump.
In April, the United States slapped a 25 per cent tariff on South Korean goods as part of Trump's sweeping global trade measures. The rates were later put on a 90-day hold, giving both sides until July to reach a deal.
"Timing is everything when it comes to the economy, and now is the time to act," Lee told lawmakers in the main chamber of parliament.
"To overcome the downturn and restore livelihoods, we have drafted a supplementary budget totalling 30.5 trillion won," he said, adding the package was designed for swift implementation.
More than 40 per cent of the spending would go towards universal consumption coupons, according to the proposal, with individuals eligible for up to 520,000 won (US$380) each.
He described the measure as "the minimum" his government could do to breathe life into the economy.
Economic growth remained below 1 per cent for four consecutive quarters, before posting negative growth in the first quarter of this year, Lee said.
Private consumption and government spending also contracted in the first quarter, he added.
Consumer prices rose to 1.9 per cent in May from the year before, official data showed.
Lee's request is widely expected to pass, as his centre-left Democratic Party commands a majority in the 300-seat legislature.
On North Korea, he reaffirmed his campaign pledge to pursue dialogue with Pyongyang without preconditions, saying peace on the Korean peninsula was key to economic growth.
"I will create a virtuous cycle where peace drives economic growth, which in turn further strengthens peace," he said.
Lee's tenure begins as South Korea finds itself in the middle of a growing superpower standoff between the United States, its traditional security guarantor, and China, its largest trade partner.