Public firms’ investment to reach W55 tril. this year
Korea’s finance minister said Wednesday that public companies’ combined investments will reach 55 trillion won ($45.6 billion) this year in the latest effort to boost Asia’s fourth-largest economy.
Hong Nam-ki, the minister of economy and finance, made the announcement in a meeting with officials in Seoul.
The figure represents a hike of 2 trillion won from the government’s initial plan in January. Last year, public companies invested 43.5 trillion won.
South Korean officials said investments by public companies such as the Korea Electric Power Corp. and the Korea Land & Housing Corp. could help revitalize the country’s slowing economy.
Hong also said the government will inject about 1.6 trillion won to boost investment and domestic demand by adjusting the management plans of 14 out of 67 state funds.
The move comes as South Korea struggles to revive an economy grappling with slowing exports, weak domestic demand and trade friction between the United States and China, as well as Japan’s trade restrictions against South Korea.
Korea’s gross domestic product expanded 1 percent in the April-June period, rebounding from a 0.4 percent quarter-on-quarter contraction the previous quarter, according to preliminary data from the Bank of Korea.
But the second-quarter expansion was lower than the initially projected 1.1 percent.
The central bank recently slashed its economic growth outlook for the country’s economy this year to 2.2 percent from 2.5 percent, citing increased uncertainty. The finance ministry also trimmed its growth estimate for the year by 0.2 percentage points to between 2.4 percent and 2.5 percent.