South Korea in $11bn economy plan
November 3, 2008
Uncertainty over the economy has caused market volatility
South Korea has announced an economic package worth around 14 trillion won ($10.9bn; £6.6bn) to boost the economy.
The stimulus plan, announced by the Ministry of Strategy and Finance, is meant to help avert a recession.
Eleven trillion won is aimed at public projects and three trillion won is for tax cuts to encourage spending.
Recent figures indicated that South Korean’s third quarter economic growth reached a three-year low, as a wider global slowdown hit exports.
In light of the global slowdown the finance ministry said: “The Korean government proposes policy measures to cope with these unprecedented challenges by announcing pre-emptive, decisive and sufficient counter measures”.
The government, amid fears of a repeat of the 1997-98 Asian economic crisis, has been taking steps to increase liquidity.
On Thursday South Korea signed a currency swap deal with the US Federal Reserve, valued at $30bn.
And the country recently reduced its interest rate to 4.25% from 5% during an emergency meeting as a fillip to the economy.
Source: bbc.co.uk/
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