Go to contents

`More Gov`t Spending Inevitable Amid Crisis`

Posted March. 21, 2009 08:19,   


Before being confirmed as strategy and finance minister, Yoon Jeung-hyun told The Dong-A Ilbo Jan. 19 said the global financial crisis was invited by excess liquidity due to super-low interest rates.

"In the process of dealing with the issue, governments have repeated their old measures while lowering interest rates and injecting liquidity into market. It is understandable that they have no other measures at the moment. Nevertheless, it really matters when they will make more moderate moves.”

These comments implied Yoon’s fears over the aftermath resulting from the government’s measures to deal with the recent crisis. He officially talked about issuing a revised supplementary budget immediately after his confirmation Feb. 10, however, sending a signal that the government will inject more money into the market as a pump priming measure.

Yoon’s policies seem to clash with his beliefs. Given the rapidly cooling economy, most experts say no government will choose no other option than the old-fashioned economic stimulus package.

At the same time, they urged the government should do its best to minimize the aftereffects of expanded spending.