What Are the Key Issues in This Year's Ministry of Economy and Finance Audit?

Sharp Rise in National Debt Due to 4th Supplementary Budget... "Government to Consider 'Fiscal Rules'"

[Image source=Yonhap News]

[Asia Economy Reporter Jang Sehee] This year's National Assembly audit by the Planning and Finance Committee is expected to focus primarily on issues such as national debt and fiscal rules related to the 4th supplementary budget (supplementary budget).

According to the National Assembly on the 4th, this year's audit will be conducted from the 7th to the 26th, following the Chuseok holiday. The audit will cover key economic agencies including the Ministry of Economy and Finance, the Bank of Korea, the Statistics Korea, the Korea Customs Service, and the Public Procurement Service.

In particular, the effectiveness of the 4th supplementary budget is expected to be a major point of contention. Previously, the People Power Party argued that the national debt ratio to Gross Domestic Product (GDP) would exceed 44% due to the 4th supplementary budget and called for cuts to some project budgets such as telecommunications expenses. In response, the government and ruling party are expected to emphasize the inevitability of maintaining an expansionary fiscal policy to address the damage caused by the novel coronavirus disease (COVID-19).

Moreover, debates are likely to intensify over the rapidly increased national debt following the four supplementary budgets this year. After the 4th supplementary budget, the national debt rose to a record high of 846.9 trillion won, and the national debt ratio to GDP surged to 43.9%. Accordingly, the opposition party plans to review the fiscal rules to be announced on the 5th and assess the effectiveness of introducing such fiscal rules.

This content was produced with the assistance of AI translation services.