South Korea’s Finance Ministry has proposed a budget of 513.5 trillion won ($424 billion) for 2020, an 8% increase from 2019. This expansionary budget is intended to heal South Korea’s export-driven economy suffering from the ongoing trade dispute with Japan. South Korea’s economy appears troubled as exports have declined for eight successive months and Japan has removed South Korea from its list of preferential trade partners. Much of the new budget would be earmarked for job creation, welfare expansions, and new development. The proposed budget includes a 17.3% increase in spending on research and development to help South Korea develop its key materials and parts industries as well as to invest in future growth engines such as 5G networks, artificial intelligence, and bio-health services.
