The South Korean government, led by President Lee Jae Myung, has approved a supplementary budget of $23.3 billion to shield the economy from U.S. tariff risks.
Key Objectives of the Budget
The primary objective of the supplementary budget is to support critical industries, such as automobiles, batteries, and semiconductors, from the impacts of rising tariffs. The budget was approved with the backing of the Democratic Party majority in the National Assembly.
Direct Payments and Industry Support
According to the plans, starting July 21, 2025, direct cash payments will be provided to citizens, along with emergency aid for affected sectors. The Finance Ministry has emphasized efficient resource allocation and industry support.
Potential Market Implications
Historically, similar measures in East Asia, such as during the U.S.-China trade conflict, have led to temporary increases in domestic liquidity. While current data does not show direct impacts on cryptocurrencies, market observers are watching for potential liquidity increases that could influence trading on designated crypto markets.
The $23.3 billion budget is aimed at mitigating the effects of tariffs and supporting key sectors of South Korea's economy, ensuring economic stability amid global market uncertainties.
