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[SEJONG] South Korea will stick to expansionary policy this year and 2016 as it tries to rev up economic activity, while a supplementary budget will only be considered if the economy makes a sharp downturn, the finance ministry said on Wednesday.
The ministry said in a statement released after its annual meeting with President Park Geun Hye on the country's fiscal strategy that it plans to maintain fiscal soundness through what it called aggressive reforms.
"We are in difficult times regarding finances, but we plan to stand by our existing stance to improve the situation by propping up the economy," Bang Moon Kyu, a vice-finance minister, told reporters in remarks held for publication.
"The government is aiming for more tax revenue through reforms and revitalising economic activity. Raising taxes would be a last resort." Mr Bang said a supplementary budget would only be considered if the economy takes a turn for the worse and after other measures are taken.
As part of its plans to efficiently manage its budget, the government will review all of its spending projects in June to reduce or remove spending for some entirely.
The ministry also plans to announce for the first time in June its long-term fiscal forecast up to 2060. The outlook will be reviewed every two years.
The plans come a day after Ms Park called for strategic measures to sustain recent economic improvements and overcome hurdles including sluggish global demand and a weak Japanese yen.