'Interest rate cut and reformation are possible,' says finance minister,

'Interest rate cut and reformation are possible,' says finance minister,. April. 14, 2016 07:22. by 뉴욕=부형권특파원, 세종=이상훈기자 bookum90@donga.com,january@donga.com.

Deputy Prime Minister for Economic Affairs and Finance Minister Yoo Il-ho stated that an annual 1.5 percent interest rate cut is possible and that a revised supplementary budget can be drawn by issuing additional government bonds. This statement seems to indicate that the government plans for explanatory expansionary fiscal policy as soon as the 20th general election period is over.

In an interview with the Bloomberg News that took place on Tuesday (local time) in New York, Minister Yoo noted, "If foreign conditions become worse than anticipated, we would have to depend on a revised supplementary budget or other means of policy."

Yoo added, "Korea's current standard interest is higher than other countries' and national debt as a proportion of GDP is 37.9 percent, lower than most advanced countries. Now Korea has two options." He mentioned preconditions of interest rate reduction and a revised supplementary budget by saying, "If China's economy is aggravated or the negative interest continues in Japan and the Euro zone (17 countries), the situation might change."

On the same day at a presentation on Korean economy held in Lotte New York Palace Hotel, Yoo remarked, "Although the risk is higher due to global economic slowdown and an unstable foreign financial market, I believe that Korea will still meet its goal of 3.1 percent of growth this year."