Democratic Party Proposes Supplementary Budget... "Economy Must Be Revived with Active Fiscal Policy"

Urgent Measure for Livelihood Recovery: Demand for 1 Million Won Livelihood Recovery Support Fund per Household

The Democratic Party of Korea proposed on the 18th that the government and the ruling party prepare a supplementary budget. They emphasized the need for an active fiscal policy.

Hong Ik-pyo, the floor leader of the Democratic Party, said at the policy coordination meeting held at the National Assembly that day, "The public sentiment in this April general election is for the ruling and opposition parties to come together to stabilize people’s livelihoods and revive the economy," adding, "To overcome the economic crisis and stabilize the people’s economy, it is urgent for both parties to pool their wisdom and cooperate in preparing the supplementary budget."

Hong Ik-pyo, the floor leader of the Democratic Party of Korea, is speaking at the policy coordination meeting held at the National Assembly on the 18th. Photo by Kim Hyun-min kimhyun81@

Regarding the economic situation, Floor Leader Hong stated, "Due to the incompetence and irresponsibility of the Yoon Seok-yeol administration, our economy is vulnerably exposed to external environments, and the livelihoods of ordinary people and the middle class, as well as businesses, are facing particular difficulties," and explained, "In March this year, import prices rose by 0.4 percentage points compared to the previous month, marking three consecutive months of increase. This indicator does not yet reflect the instability in the Middle East, so a more severe high-price situation is expected to continue." He continued, "Our companies are facing declining export competitiveness due to rising production costs such as raw materials, weakening performance due to sluggish domestic demand, and a decrease in capacity for facility investment and research and development, raising concerns that the long-term outlook may worsen."

Floor Leader Hong mentioned the difficulties faced by ordinary people and the increased challenges for companies due to foreign debts combined with high exchange rates, stating, "Urgent measures to restore livelihoods, such as reducing interest burdens for small business owners, expanding low-interest refinancing loans, and supporting energy costs like electricity bills, must be implemented immediately. Additionally, active measures should be taken to ensure stable management of corporate foreign debts and to strengthen export competitiveness."

Regarding the government’s policy stance, he emphasized, "We must not fall into a vicious cycle where focusing on the unrealistic goal of austerity worsens both fiscal health and the economy," and added, "Through an active fiscal expansion policy, we can revive the economy, and if our economy recovers, the fiscal soundness that the government emphasizes can also improve."

At the same meeting, Lee Gae-ho, the chairman of the Policy Committee, reiterated the livelihood support measures he had previously announced under the name of urgent livelihood recovery measures. He proposed, "We suggest a livelihood recovery support fund in the form of local currency of 250,000 won per person, or 1 million won for a family of four," and added, "Additional support of 100,000 won per person is necessary for basic livelihood security recipients, the near-poor, and single-parent families. This is expected to cost about 13 trillion won." He continued, "We need to double the low-interest refinancing loan budget from the currently allocated 500 billion won to 1 trillion won, and also double the small business and traditional market fund from 400 billion won to 800 billion won to ease loans and interest burdens for small business owners." Furthermore, he said, "Given the possibility of rising energy costs due to high oil prices, we propose an additional increase of about 300 billion won to support electricity costs for small business owners during the summer and to address blind spots in support measures. Also, for low-credit and low-income individuals who have no choice but to use high-interest loans due to difficulties in obtaining loans from regulated financial institutions, it is necessary to increase the Sunshine Loan fund by 90 billion won."