Ruling party, gov't stress active fiscal policy to boost growth in 2027 budget
Summary
The ruling Democratic Party of Korea and the government said in Seoul on Tuesday that fiscal policy should play an active role in supporting 2027 economic growth. Han Byung-do said budget priorities should focus on youth, region-led growth and future industries, while Rep. Kwon Chil-seung called for strategic investment in AI, bio, culture, defense and energy. Budget Minister Park Hong-geun said the government will use a future response fund to channel extra semiconductor tax revenue into strategic investment. President Lee Jae Myung earlier said next year’s budget would be around 800 trillion won and include the fund.
Key Facts
- Han Byung-do urged the government to prioritize how the budget is allocated and to focus fiscal capacity on future industries.
- Rep. Kwon Chil-seung said strategic investment in artificial intelligence should help Korea become one of the world’s top three AI powerhouses.
- Budget Minister Park Hong-geun said the government will use the future response fund to invest increased tax revenue from the semiconductor boom rather than spend it in the short term.
- President Lee Jae Myung said the government will draw up a record-high budget of around 800 trillion won for next year.
- The planned spending priorities include policies for young generations and regional development.
Budget Minister Park Hong-geun, left, and Democratic Party of Korea's floor leader Han Byung-do attend a consultative meeting of party and government officials at the National Assembly in Seoul, Tuesday, to discuss the government's 2027 budget. Yonhap
The ruling Democratic Party of Korea (DPK) and the government on Tuesday stressed the need for the active role of fiscal policy and investment in future industries to support the country's economic growth.
"Above all, we should focus our fiscal capacity on securing leadership in future industries," DPK floor leader Han Byung-do said during a consultative meeting between party and government officials on next year's budget.
He urged the government to set priorities on where and how to allocate the budget, emphasizing the need to strategically invest in areas supporting the youth, region-led growth and future industries.
Echoing Han's call to boost future industries, Rep. Kwon Chil-seung, the DPK's chief policymaker, called for strategic investments in artificial intelligence (AI) to help Korea become one of the world's top three AI powerhouses.
"The 2027 budget should play an active fiscal role, not only in supporting the country's growth but also its transformation," Kwon said, noting that investment should also be made in key sectors, such as bio, culture, defense and energy.
On the government's fiscal strategy, Budget Minister Park Hong-geun said the government will focus on supporting the country's economic growth through active fiscal management to create an "irreplaceable Korea."
Park said the government will use the so-called "future response fund" to put increased tax revenue from the semiconductor boom toward strategic investment rather than short-term spending.
President Lee Jae Myung earlier announced that the government will draw up a record-high budget of around 800 trillion won ($540 billion) for next year and use the additional tax revenue expected from the ongoing semiconductor boom to create the future response fund to invest in future industries, policies for young generations and regional development.
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