South Korea considers extra budget in early 2025 to boost spending

South Korea is considering drawing up a supplementary budget early next year to counter the slumping consumer spending and slowing economic growth, the Chosun Ilbo daily reported on Friday, citing an unnamed presidential official.

President Yoon Suk Yeol's administration has prioritised fiscal discipline amid dwindling tax revenue and allocated an extra budget only once shortly after he took office 2022.

But the government sees the need for additional expenditures to boost domestic demand, support underprivileged people and curb income and educational inequality, the report said, quoting the official as saying that economic circumstances at home and outside have changed significantly since the government drafted its 2025 spending plan in August.

Under the proposal, the finance ministry set next year's total government expenditure at 677.4 trillion won ($484.3 billion), up 3.2% from 2024. It marks a slightly bigger increase than this year's smallest boost since 2005, at 2.8%, but less than the 4.2% previously projected.

Yoon's office did not immediately respond to a request for comment on the report.

($1 = 1,398.7700 won)

(Reporting by Hyonhee Shin; Editing by Stephen Coates)