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S. Korea to keep economic props in place

Jan. 18, 2010 at 4:03 PM   |   Comments

SEOUL, Jan. 18 (UPI) -- South Korean Finance Minister Yoon Jeung-hun said Monday it was too early to pull back from government programs set up to combat the fading recession.

"The Korean economy has been bouncing back fast, with the 2009 current account surplus estimated to reach $43 billion. But international financial market jitters, such as Dubai's debt problem, could pour cold water on the recovering economy," Yoon told The Korea Times.

"The nation's financial sector has more room to improve, compared to the manufacturing industry," Financial Services Commission Chairman Chin Dong-soo said.

Chin said the government would "remove unnecessary regulation to turn the financial industry into a new growth engine."

Randall Jones, head of Korea and Japan units at the Organization of Economic Cooperation and Development, said a combination of stimulus spending and loose money policy had given domestic consumption a boost and created jobs.

"Public investments and state subsidies provided to businesses and households have created nearly 200,000 positions. Despite the loosened monetary policies and the depreciation of the Korean won against the dollar, consumer prices here largely remained tamed," Jones said.

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