Government seeks to protect consumers and businesses from energy and market fallout of US-Israel conflict
The South Korean government is proposing a $17.3 billion supplementary budget to cushion the economic impact of the US-Israel war on Iran, Reuters reports.
President Lee Jae Myung called for “bold measures” to address concerns over rising energy costs and market volatility caused by the escalating conflict. The proposed budget aims to support consumers and companies affected by disruptions in oil supply and surging prices.
This marks the second extra budget in less than a year under Lee’s administration, which has committed to an expansionary fiscal policy to stimulate economic growth since his inauguration last June.
South Korea depends on the Middle East for 70% of its oil, making the country particularly vulnerable to instability in the region.
Financial markets have reflected these concerns: the KOSPI index has fallen 11.36% over the past month, and on Tuesday it dropped 2.71%, losing 143 points to close at 5,134.16 as of 04:00 GMT.
The supplementary budget is intended to stabilize markets, ease consumer costs, and protect the economy from further fallout of the Middle East conflict.
Source: Al Jazeera