Business
SEOUL, May 7 (Reuters) - South Korean lawmakers ratified on Tuesday a supplementary government budget calling for 5.3 trillion Korean won ($4.84 billion) in fiscal stimulus, aiming to boost overall growth by creating jobs and supporting smaller businesses.
Parliament passed a bill calling for a 17.3 trillion won extra budget, with 12 trillion won to make up for a budget shortfall stemming from weaker-than-anticipated growth and the rest seeking to revive economic momentum.
The government of President Park Geun-hye, inaugurated in February, proposed the extra budget last month after forecasting that the economy would grow by just 2.3 percent without government stimulus.
The previous administration in December forecast 3 percent growth this year, while the Bank of Korea in April forecast 2.6 percent growth this year.
The Park administration aims to achieve 2.8 percent growth for the year through the extra budget and other stimulus measures, including regulatory easing and tax incentives to boost property market transactions and corporate investment.
The extra budget will be almost entirely funded by additional borrowing. As a result, the fiscal deficit is projected to rise to 1.8 percent of gross domestic product from a 0.3 percent deficit initially targeted for the year.
The extra budget ratified by parliament made minor changes to government proposals on extra spending, but initial aims of concentrating new spending on creating jobs and supporting the working class and smaller businesses were left intact.
($1 = 1094.4500 Korean won) (Reporting by Se Young Lee)
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