South Korean Gov't To Inject US$5 Bln More To Spur Investment From Public Institutions

SEJONG (South Korea), Sept 8 (Bernama-Yonhap) -- South Korean Finance Minister Koo Yun-cheol said Monday the government plans to inject an additional 7 trillion won (US$5.03 billion) by the end of this year to spur investment from public institutions, as part of efforts to revitalise the economy amid a prolonged slowdown.

According to the Yonhap News Agency, Koo made the remarks during his first official press briefing since taking office, during which he outlined the ministry's priorities in macroeconomic management.

"The government plans to carry out an additional 7.0 trillion won in budget execution through public institutions by year-end," Koo said.

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Koo said the ministry will place policy emphasis on three areas -- responding to economic cycles, revitalising livelihoods and stabilising consumer prices.

In particular, the minister stressed efforts to tame inflation for essential living costs, such as food prices, ahead of the extended Chuseok holiday early next month.

The minister said a comprehensive holiday support plan will be announced soon to ensure price stability and protect vulnerable groups.

Consumer prices, a key indicator of inflation, rose 1.7 per cent on-year in August, the slowest increase in nine months, according to Statistics Korea.

The agency, however, has noted that the moderation may be temporary. The statistics office earlier said the inflation rate would have reached 2.3 per cent in August, marking the fastest price growth since July 2024, had it not been for a sharp drop in mobile phone fees.

Koo's press conference came a day after the government announced a major restructuring plan that would strip the Economy and Finance Ministry of its budget planning authority. A new fiscal agency under the prime minister's office will be established to take over such a role.

Amid concerns that the plan could weaken the ministry's ability to coordinate economic policy, Koo sought to reassure the public.

"I have long experience in policy coordination and understand the logic behind budget planning," he said, adding the ministry and the envisioned entity will rather create a synergy effect.

Regarding ongoing discussions with the United States on exchange rate issues, Koo said an announcement will be made in conjunction with the outcome of separate tariff-related talks.

"Working-level consultations with the US Treasury Department on exchange rates are currently under way," he said.

The minister also addressed recent speculation about possible revisions to real estate-related tax codes, saying any changes must be carefully considered in light of housing market trends.

On Sunday, the government unveiled a major housing plan aimed at stabilising the property market. Under the plan, 270,000 new housing units will be built annually in the greater Seoul area from 2026 to 2030, totaling 1.35 million new homes.

"When it comes to housing supply, speed is key," he added.

-- BERNAMA-YONHAP