Bank of Korea Governor Lee Changyong noted during a press conference right after the Monetary Policy Committee on the 17th that "organizing a supplementary budget of 12 trillion won will have the effect of raising the economic growth rate by 0.1 percentage points (p)."
Governor Lee argued that a supplementary budget of 20 trillion won should be organized to stimulate the economy right after the Monetary Policy Committee in January, estimating the growth rate enhancing effect at 0.2 p. However, as the scale of the supplementary budget proposed by the government has remained at 12 trillion won recently, the growth rate enhancement effect has been lowered to 0.1 p.
The governor said, "The scale of the supplementary budget has been reduced to half of what the Bank of Korea proposed in February, resulting in a smaller growth rate enhancement effect." He added, "However, depending on what kind of expenditure it is, the fiscal multiplier effect can vary, and once the supplementary budget proposal is confirmed, I will reveal details during the forecast announcement in May."
When asked whether the scale of 12 trillion won is appropriate, he said, "In the first quarter, due to martial law, I unusually mentioned the necessity of a supplementary budget despite the controversy over political neutrality to prevent overseas prestigious institutions from projecting our country's growth rate too negatively." He stated, "Now that such a situation has passed, I think it is inappropriate for the Bank of Korea governor to discuss the scale of the supplementary budget."