S. Korea's President urges swift parliamentary approval for USD 17 billion to tackle energy fallout amid West Asia conflict
Seoul, April 2
South Korean President Lee Jae Myung on Thursday called on the country's National Assembly to quickly pass a KRW 26.2 trillion supplementary budget, aimed at cushioning the economic impact of the ongoing conflict in the Middle East, Yonhap News Agency reported.
According to the Yonhap News Agency, during the budget address, Lee described the situation as an "unexpected, multifaceted crisis" as the US-led war involving Iran enters its second month, stressing that extraordinary steps are necessary to stabilise the economy.
"The government recognises the current situation as a wartime-level crisis for the people's economy and is mobilising all available resources to overcome it," he said, as quoted by Yonhap News Agency.
Lee highlighted that disruptions in global energy supply--particularly due to virtual blockades around the Strait of Hormuz--have significantly pushed up fuel prices and warned of shortages in critical industrial inputs such as naphtha and urea, which could affect sectors ranging from petrochemicals to fertilisers.
To mitigate the impact, the proposed budget includes over KRW 10 trillion to offset rising oil costs and KRW 5.1 trillion to sustain a fuel price cap system and ensure a stable supply of key raw materials. The government also plans to strengthen stockpiling measures and improve transparency in fuel pricing and distribution.
According to Yonhap News Agency, the major component of the package is KRW 4.8 trillion earmarked for direct financial support to nearly 35.8 million citizens, primarily targeting the lower 70 per cent of income groups.
Payments will range between KRW 100,000 and KRW 600,000, depending on income level and regional factors.
Lee said the proposal aims to protect vulnerable populations while preventing a slowdown in economic recovery, adding that the plan will be funded through increased tax revenues driven by strong stock market performance and the semiconductor industry, without issuing new government bonds.
"It is designed to make bold investments where needed in the wake of the Middle East crisis, while ensuring the burden is not passed on to the public or the broader economy," he said, as quoted by Yonhap News Agency.
The ruling party and the main opposition have reportedly agreed to pass the budget bill by April 10, signalling bipartisan urgency in addressing the economic fallout of the ongoing West Asia conflict.
— ANI
Reader Comments
Direct financial support to 35 million citizens is impressive. It shows a government actually trying to cushion the blow for common people. Hope the execution is transparent. We've seen how subsidy schemes can get messy here. 🙏
Funding it through increased tax revenues from stocks and semiconductors is smart economics. No new debt. Our finance ministry should take notes. Every conflict in West Asia sends shockwaves to our petrol pumps. We need long-term planning, not just reactive measures.
While the intent is good, I'm always skeptical of such massive supplementary budgets. "Wartime-level crisis" is strong language. Hope the funds are used efficiently and reach the intended beneficiaries. Corruption can derail even the best plans.
The mention of urea shortages is key! Remember the urea crisis we had? It hit our farmers hard. Global supply chains are so fragile. South Korea is right to stockpile. Jai Kisan! 🇮🇳
Bipartisan agreement to pass it by April 10? That's the real story. Our politicians could learn something about putting national interest first during a crisis, instead of endless debate and blame games.
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