South Korea vows support for domestic consumption, cautious on inflation

March 29, 2023 12:43 PM AEDT | By Reuters
Follow us on Google News:
Image source: Reuters

By Choonsik Yoo

SEOUL (Reuters) - South Korea unveiled on Wednesday a package of measures aimed at boosting domestic consumption, but stopped short of offering big-ticket plans for fear of stoking inflation, which is slowing but still high.

The government said in a statement distributed by the finance ministry that it would implement steps necessary to attract more foreign tourists and boost their spending while staying in the country.

The measures were reported at a meeting headed by President Yoon Suk Yeol, who said at the beginning that the government needs to take steps to attract more foreign tourists, such as increasing international flights.

"The conditions are forming so that we can aim to help the consumption and tourism business operations recover to the levels seen before the COVID-19 pandemic," Yoon said.

The government said in the statement it would help the number of weekly flights to and from China, Japan and Southeast Asia rise by September to 90% of that operating in 2019, compared with some 60% in February.

Other than that, measures included in the more than 30-page statement were mostly low-key ones as the government is worried about rekindling slowing but still sticky inflation.

South Korea's policy authorities are faced with the double task of keeping the economy from cooling too fast while making sure that inflation continues to head down below the 2% target.

Ratings agency S&P Global Ratings said in a report on Sunday growth in South Korea's trade-reliant economy would slow to 1.1% this year, far below the government's projection of 1.6%, from 2.6% last year.

Inflation, however, remains more than twice the central bank's target although falling in recent months, making it difficult for the authorities to shift policy focus away from a tightening bias.

(Reporting by Choonsik Yoo; Editing by Muralikumar Anantharaman and Michael Perry)


Disclaimer

The above content is directly sourced from Reuters under a contractual arrangement. The content is being provided as a convenience and for informational purposes only; and does not constitute an endorsement or approval by Kalkine Media of any of the products, services, or opinions of the organization or individual. The user is apprised that Kalkine Media bears no responsibility for the accuracy, legality, or content of Reuters, any external sites, or for that of subsequent links. The user is requested to contact Reuters directly for answers to questions regarding the content. Please note that Kalkine Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.



Top ASX Listed Companies

We use cookies to ensure that we give you the best experience on our website. If you continue to use this site we will assume that you are happy with it. OK