South Korea's fiscal soundness will rank fifth among Group of 20 (G20) major advanced and developing countries this year despite its ongoing efforts to stimulate the sagging economy through tax cuts and additional spending, Yonhap News Agency reported Monday.
According to a report by the International Monetary Fund (IMF), South Korea's fiscal deficit will account for 3.2 percent of gross domestic product (GDP) this year, less than half the average 6.6 percent of G20 countries.
India will see its deficit account for 10.2 percent of GDP this year, while Britain, Japan and the United States will likely post 9.8 percent, 9.4 percent and 9.1 percent, respectively, the report showed.
Of the 20 countries, Brazil, Australia, Indonesia and South Africa were the only nations the IMF forecast to post deficits less than South Korea.
The Seoul government joined global efforts to overcome an economic crisis with diverse tax cuts, additional fiscal spending and other pump-priming measures as the global recession dents demand for Korean goods at home and abroad.
Last month, the parliament passed a 28.4 trillion won extra budget, helping to speed up the government's bid to revive the sagging economy. The additional spending, to be secured primarily through debt sales, raised concerns it could hurt the nation's fiscal soundness.
South Korea's economy, Asia's fourth-largest, will likely shrink 2.4 percent this year, the first negative growth in more than a decade, according to the latest prediction by the central bank.
The IMF predicted that South Korea's fiscal deficit to GDP will grow to 4.7 percent in 2010 but it is still lower than 6.5 percent that it forecast for all G20 countries.