Date
20 September 2019
Finance Minister Hong Nam-ki told heads of the country’s 137 state-owned organizations at a meeting to increase their investment by 1 trillion won this year to prop up the economy. Photo: Bloomberg
Finance Minister Hong Nam-ki told heads of the country’s 137 state-owned organizations at a meeting to increase their investment by 1 trillion won this year to prop up the economy. Photo: Bloomberg

South Korea tells state firms to boost spending as economy slows

South Korea’s government told state enterprises on Wednesday to spend 1 trillion won (US$824.63 million) more than they had planned for the rest of the year to support cooling private sector activity, Reuters reports.

Finance Minister Hong Nam-ki told heads of the country’s 137 state-owned organizations at a meeting to increase their investment by 1 trillion won this year to prop up the economy, taking total investment for the year to 55 trillion won.

This means public enterprises now have to boost their spending by some 6 percent for the rest of the year as Asia’s fourth-largest economy is widely expected to miss the government’s recently downgraded growth target this year.

The government has a 2.4 to 2.5 percent growth target for this year but global investment banks see growth tumbling to as low as 1.4 percent from 2.7 percent last year, one of the worst in half a century.

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