Despite record low interest rates of 1.25 percent and a previous government’s fiscal stimulus, South Korea’s economy hasn’t moved out of the slow lane. The exporter nation is expected to post a 2 percent growth rate for 2019, its worst record in a decade.
South Korea’s economy has taken hits from China’s weakness and a drop in the global computer-chip market, for which South Korea has been a major supplier.
Now the government is putting the pedal down with a $52.1 billion investment in housing, parks, and infrastructure.
With a legislative election looming in April, the government opening its wallet to hold onto jobs and make more affordable housing available in Seoul, where apartments have become so pricey that the government has banned lending mortgages on flats costing more than $1.2 million.
Dubai: Spending Its Way to Prosperity
Also on the fiscal stimulus path, Dubai’s 2020 government budget rose by 17 percent to a record €18.6 billion.
More than 45 percent of the budget is earmarked for transport, infrastructure, and economic stimulus to help the emirate remain competitive as a Middle Eastern business hub.
The government hopes the spending will spark 3.2 percent growth in 2020, compared to 2.1 percent expected for 2019 and a rate below 2 percent in 2018.
The budget relies on oil for only 6 percent of revenue. The rest is expected to come from taxes and fees, a boost in tourism, and “disciplined fiscal policies” that will deliver a modest surplus.
About 3 percent of the budget is reserved for costs related to the six-month Expo 2020 fair that Dubai will host, beginning in October.
