[Economic Outlook] This Week's 14 Trillion Won Supplementary Budget Details Released... Focus on Producer Price Increase

300 Million KRW 'Quarantine Support Fund' to be Provided to Small Business Owners
Supplementary Budget Bill to be Submitted to the National Assembly in January

Hong Nam-ki, Deputy Prime Minister and Minister of Economy and Finance (center), and Kwon Deok-cheol, Minister of Health and Welfare (right), are waiting for the joint government briefing on the extension of quarantine measures and support for small business owners held on the 14th at the Government Seoul Office in Jongno-gu, Seoul. Photo by Kim Hyun-min kimhyun81@

[Asia Economy Reporter Jang Sehee] This week, an additional supplementary budget of approximately 14 trillion won to support small business owners affected by the COVID-19 crisis is scheduled to be approved at the Cabinet meeting. Additionally, attention is focused on the rise in the Producer Price Index amid continuing increases in raw material prices.

The government plans to prepare the supplementary budget of about 14 trillion won within this week and complete its approval at the Cabinet meeting. The government intends to submit this supplementary budget to the National Assembly in the last week of January.

This supplementary budget includes additional disbursement of quarantine support funds worth 3 million won to small business owners whose sales have declined, and an increase in the compensation fund for small business losses from the existing 3.2 trillion won to 5.1 trillion won.

The supplementary budget funds will utilize the excess tax revenue of 10 trillion won from last year. However, since these funds cannot be used before the government’s fiscal settlement for last year, most of the budget will be covered by issuing deficit bonds for the time being.

The Bank of Korea will announce the "Producer Price Index for December 2021" on the 20th.

In November, the producer price rose by 9.6% compared to the previous year, marking the largest increase in 157 months (13 years and 1 month) since October 2008 (10.8%). Looking at the month-to-month rate of change by item, the electricity, gas, water, and waste sectors rose by 1.8%.

With the continued strength in oil and raw material prices, it is estimated that the Producer Price Index also rose for the 14th consecutive month in December last year.

Finally, the government will launch the next-generation digital budget accounting system, "Dbrain," on the 20th.

The next-generation Dbrain is a newly built system that reorganizes the existing Dbrain, which handled 13 financial tasks related to budget formulation, execution, accounting, and settlement, by adding 11 financial tasks such as contributions and grants, enabling not only task processing but also decision-making.

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