"Boosting Consumption Through Chuseok Livelihood Stabilization Measures"
The Presidential Office announced that President Yoon Suk-yeol's 2nd anniversary press conference will be held on the 9th at 10 a.m. The photo was taken on the 7th at the Presidential Office in Yongsan-gu, Seoul. Photo by Kang Jin-hyung aymsdream@
On the 28th, the Presidential Office stated amid concerns over high-intensity fiscal tightening due to sluggish domestic demand, "In a situation where the fiscal multiplier has declined, increasing government spending may not significantly impact economic growth and could only lead to an increase in national debt due to deficit bond issuance."
A Presidential Office official told Asia Economy on the same day, "The government is focusing its efforts on regulatory innovation to allow the private sector to fully exercise creativity and capabilities rather than fiscal expansion for economic growth."
In response to recent criticisms that the '2025 budget plan' could weaken economic responsiveness due to high-intensity fiscal tightening, the Presidential Office reiterated the necessity of fiscal tightening.
The official explained, "The fiscal multiplier is an indicator showing how much government spending affects Gross Domestic Product (GDP), and it is currently much lower than in the past." He added, "The Yoon Suk-yeol administration has been establishing a free market economy by having the private sector lead and the government support. As our economy grows, the private sector's share has become much larger than that of the government sector."
Furthermore, he added, "To quickly recover domestic demand, we are stimulating consumption through Chuseok livelihood stabilization measures and promoting investment activation through plans such as the August 8 housing supply expansion."
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