Hong Nam-gi "Cannot Support 2nd Disaster Relief Fund... Priority Should Be Given to More Vulnerable Groups"

Deputy Prime Minister for Economy Hong Nam-ki is attending the full meeting of the National Assembly's Strategy and Finance Committee on the 17th, responding to questions from lawmakers. Photo by Yoon Dong-ju doso7@

[Asia Economy Reporter Kim Hye-min] Hong Nam-ki, Deputy Prime Minister and Minister of Economy and Finance, stated on the 17th that he is "not actively in favor" of the second round of disaster relief payments.

Deputy Prime Minister Hong responded to a question from Kim Doo-kwan, a member of the Democratic Party of Korea, during the first meeting of the National Assembly's Planning and Finance Committee in the afternoon, saying, "If similar funds are available, I believe it would be more effective to selectively and intensively support the more vulnerable groups," emphasizing the efficient use of funds.

He explained, "The first round of support was given to the entire population as a one-time and temporary measure," adding, "It is not that we do not want to increase fiscal spending, but wouldn't it be more appropriate to prioritize support for those who have lost their jobs in the labor market, for example?"

Regarding the policy effects of the disaster relief payments, Hong said, "Looking at credit and debit card usage statistics, the funds were largely spent in traditional markets and by small business owners, and it is tentatively judged that there was a significant effect on vulnerable groups," adding, "The impact on Gross Domestic Product (GDP) can only be known after all the funds have been spent, but it is evaluated that it contributed to stimulating consumption."

On the expansionary fiscal policy stance, he said, "There is no disagreement that fiscal policy should play an active role in overcoming the crisis," but added, "However, at the same time, there is a rapid increase in national debt, and since credit rating agencies and other observers are closely watching this, we need to address concerns about national debt alongside the active role of fiscal policy."

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