2016 Budget Proposal

2016 Budget Planned to Increase Youth Employment and

Support Economic Innovation

The 2016 budget proposal pursues economic stimulation and fiscal soundness at the same time as total budgets will be increased by 11.3 trillion won, or 3.0 percent compared with the 2015 budget.  A total of 387 trillion won expenditures will be focused on increasing youth employment, promoting economic innovation, developing culture and service industries, and improving welfare.  The 2015-2019 national fiscal management plan has been drawn up to promote economic stimulation and structural reform, while helping recover fiscal soundness in the mid- to long-term.

I. 2016 Budget Proposal

1. Key Policies

The 2016 budget proposal supports economic stimulation amid increasing uncertainties, such as China’s slowdown, by maintaining recovery momentum gathered through the 2015 supplementary budget, while emphasizing increased investment in youth employment and new growth engine development in order for the economy to achieve a big leap forward.  The budget will support national priorities including structural reform, and investment to improve social security and public safety will be increased. 

Budgets will be more efficiently spent in 2016 by getting rid of wasteful spending on similar or overlapping projects and benefit fraud.  Meanwhile, the government will strictly manage national debt increases. 

2. The 2016 Budget Proposal

The total government revenues are projected to increase 2.4 percent, while the total government expenditures will increase 3.0 percent.  Fiscal soundness will temporarily worsen as fiscal deficits will increase 0.2 percentage points from 2.1 percent to GDP to 2.3 percent to GDP compared with 2015.  National debt is forecast to be 40.1 percent to GDP[1].

The 2016 budget proposal lays the foundations for creating a virtuous cycle of expansionary fiscal spending, economic recovery and increased revenues, while continues to purse fiscal expenditure efficiency, such as by thoroughly reviewing fiscal projects.

Please refer to the attached pdf for the full file