Korea’s’Gross Corona Response Expenditure and Direct Support Scale’
South Korea’s direct financial support for’extra expenditure, etc.’ in response to coronavirus is 3.4% of GDP, ranking 10th out of 10 comparative countries
The proportion of’liquidity support’ is three times that of’additional expenditure and existing tax reduction’, which is direct financial support… “Requires active financial expansion”
Reporter Song Hyun-soo [email protected]
Input: 2021-02-03 08:29:23Revision: 2021-02-03 09:41:08Posted: 2021-02-03 09:41:34
Provided by Nara Salim Institute
Provided by Nara Salim Institute
It was found that among the 10 countries with advanced economies in the G20 (20 major countries), the total amount of expenditure and direct support for Corona 19 were ranked 10th in Korea.
Korea used 13.6% of gross domestic product (GDP) to respond to Corona 19, and direct financial support for’additional expenditures’ was only 3.4% of GDP. Compared to the average 11.3% of GDP in the 10 advanced G20 economies, the average of 11.3% of GDP is used for measures such as’additional expenditure’. It was three times that of’reduction’.
Accordingly, it was pointed out that the Korean government should actively expand direct financial support measures such as’extra expenditure’.
On the 3rd, the Nara Salim Research Institute (hereinafter referred to as the Institute) translated and analyzed the IMF’Financial Monitoring Database of COVID-19 Pandemic National Fiscal Measures’ (as of the end of December 2020), which compared expenditures by country to respond to Corona 19. The results of the financial expenditure in response to Corona 19 were disclosed.
According to the IMF Database (DB), the Nara Salim Research Center is spending against COVID-19 against GDP in 10 advanced economies such as Australia, Canada, France, Germany, Italy, Japan, Korea, Spain, United Kingdom, and the United States among G20 countries. Compared. The IMF divided country-specific COVID-19 response expenditure into’extra expenditure and existing tax reduction’ measures and’liquidity support’ measures.
The’additional expenditure and existing tax reduction’ measures refer to direct support methods such as budgetary projects to respond to Corona 19, cash support such as disaster support, and existing tax reduction. The’liquidity support’ measure refers to a method that is indirect support through loans and guarantees, assuming that funds are repaid later.
According to the IMF, among the 10 G20 economically developed countries, the country with the highest GDP-to-GDP expenditure for Corona 19 response was 44.0%. Next was Italy (42.3%), Germany (38.9%), Britain (32.4%), and France (23.5%).
South Korea’s expenditure was 13.6% of GDP, ranking 10th, the last among 10 countries with advanced economies in the G20, with the lowest expenditure to GDP.
I considered it more specifically.
According to the IMF, the amount of expenditure for responding to Corona 19 in the developed countries of the G20 was overwhelmingly large in the United States at $43 billion (hereinafter referred to as US dollars). Japan ($210.0 billion), Germany ($1472 billion), the United Kingdom ($877 billion), and Italy ($7900 billion) followed.
South Korea’s COVID-19 response expenditure was $222 billion.
In addition, on average, 10 countries with advanced economies in the G20 spend 11.3% of their GDP on’additional expenditures or tax cuts’, which are direct financial aid methods such as budgetary projects and cash support.
The proportion of’additional expenditure, etc.’ to GDP as a part of fiscal measures to respond to Corona 19 is an important indicator in that it is possible to see how directly a country has invested its budget and took financial support measures.
South Korea used 3.4% of GDP for measures’additional expenditures, etc.’ in Corona 19 fiscal expenditures (13.6%) as a percentage of GDP, but by using 10.2% of GDP, which is about three times the measure of’additional expenditures’ for’liquidity support’. There was a tendency toward’liquidity support’.
Even when comparing objective expenditures alone, Korea’s’additional expenditure’ was the lowest among 10 developed countries, ranking 10th.
When comparing only the amount of expenditure of’extra expenditure, etc.’ compared to GDP to respond to Corona 19, the expenditure of’extra expenditure, etc.’ measures in Korea is the lowest among the G20 economically developed countries.
Direct financial support for’extra expenditure, etc.’ is a way that the government immediately and directly invests budgets to citizens in a situation where the economic downturn is prolonged due to the corona 19 epidemic and quarantine measures, and household debt increases, it acts as a social safety net and at the same time voluntarily To induce compliance with quarantine regulations.
The research institute introduced that although the scale and social environment of the damage caused by Corona 19 differs by country, it is expanding finances centering on 10 developed countries of the G20.
In particular, the top five countries, such as Japan, Italy, Germany, and France, which have a large amount of expenditure to respond to Corona 19 compared to GDP, account for an average of 11.5% of GDP to’additional expenditure’, even though the proportion of’liquidity support’ such as loans and guarantees is high. Used.
On the other hand, Korea spends 13.6% of its GDP to respond to Corona 19, but the proportion of measures such as’additional expenditure’ was low.
Even if we compare only the size of the objective expenditure, Korea’s measures of’additional expenditure’ were 3.5% of GDP, ranking 9th out of 10 countries with advanced economies in the G20, which was very low.
The research institute said, “The economic impact from Corona 19 is expected to continue until the end of 2021.” “Amid concerns that the economic difficulties of households and small business owners will aggravate, the government has increased the size of Korea’s economy and household debt due to COVID-19. It is necessary to actively expand direct financial support measures such as’additional expenditure’ and the total amount of expenditure for Corona 19 response to GDP.”
Reporter Song Hyun-soo [email protected]