Hong Nam-ki: "Korean-style Fiscal Rules Closer to Strictness than Leniency"

[Image source=Yonhap News]

[Asia Economy Reporter Lim Chun-han] Hong Nam-ki, Deputy Prime Minister and Minister of Economy and Finance, stated on the 5th that regarding the "Korean-style fiscal rule," he judges it to be "closer to strictness than looseness."

On the same day, during the comprehensive policy questioning at the National Assembly's Budget and Accounts Committee, Hong responded this way when Park Hong-geun, a member of the Democratic Party of Korea, pointed out criticisms that it is "ineffective or should be stricter."

Hong said about this formula, "Saying it is loose means not understanding the meaning of this formula."

Earlier, the Ministry of Economy and Finance announced a fiscal rule to manage the national debt ratio within 60% of the Gross Domestic Product (GDP) and the integrated fiscal balance within -3% of GDP starting from 2025. The formula was designed so that the value obtained by multiplying the national debt ratio divided by 60% and the integrated fiscal balance divided by -3% remains at or below 1.0, allowing the two benchmarks to be flexibly managed.

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