Terminating the military-intelligence sharing pact with Japan could make it harder to reduce economic uncertainty, as it will be difficult to predict when the Abe administration will impose export curbs on South Korea.
To reduce the negative impact that the termination of GSOMIA could have on the economy, Finance Minister Hong Nam-ki pledged to actively respond by closely monitoring the situation.
Hong will hold ministerial-level talks regarding Japan twice a week to come up with countermeasures to Japan's export curbs and to timely respond to potential market volatility.
He asked the South Korean people and businesses to unite with confidence instead of feeling overburdened.
The finance minister also used the press conference to talk about next year's government budget bill.
He said the government will increase the 2020 budget bill by around nine percent on-year to some 422-billion U.S. dollars.
"Planning the 2020 government budget bill under an expansionary fiscal stance was unavoidable considering recent global economic stagnation and domestic economic conditions for this year and next year. "
Hong said a lot of things were considered when drawing up the bill such as the active role of finance for an economic response, as well as long-term financial conditions and policy capabilities.
With such a budget for 2020, the national debt level compared to GDP will increase to 39 percent from 37.2 percent this year.
The finance ministry will submit the bill proposal to the National Assembly on September 3rd after it goes through a government-ruling party consultation and is discussed by the cabinet next week.
Hong Yoo, Arirang News.