South Korea to spend 45.4 trillion won from Future Response Fund

  • South Korea will allocate Future Response Fund money across four policy areas.
  • The government will spend 45.4 trillion won and reserve 104.4 trillion won.
  • Critics question cash support and spending shifts of up to 30% without approval.

South Korea plans to spend 45.4 trillion won ($33 billion) of a 162.3 trillion-won Future Response Fund launching next year across four areas: young adults, growth engines, regional development, and education and talent. The government will allocate 12.5 trillion won to reduce new bond issuance and reserve 104.4 trillion won against fluctuations in tax revenue. The fund is financed by domestic tax revenue exceeding its 10-year trend line, defined as 6.2%, with this year’s excess revenue also added to reserves. Youth measures include a 1.7 trillion-won savings plan without an income requirement, housing and family support, employment assistance, startup commercialization, and an expanded culture and arts pass. Critics warn that the spending could become handouts and say flexible reallocations of up to 30% without additional National Assembly approval could allow the fund to operate as a slush fund.

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