Fiscal Policy

Finance Minister Koo Yun-cheol said Friday the government is taking extra vigilance over recent volatility in the foreign exchange market.

30 Mwezi wa tatu, 2026 Imeripotiwa na AI

Prime Minister Kim Min-seok vowed on Monday that the government would use taxpayers' money responsibly after the Cabinet approved guidelines for the 2027 budget. The plan emphasizes an expansionary fiscal policy to foster new growth engines, with spending set at 764.4 trillion won ($503 billion), up 5 percent from 728 trillion won this year.

The National Statistics Office has forecasted a 7.4% growth for the Indian economy in 2025-26, surpassing earlier expectations. While the first half of the year saw 8% expansion, the second half is expected to moderate to 6.8%. Services sector leads the acceleration, though nominal growth raises fiscal worries.

3 Mwezi wa kwanza, 2026 Imeripotiwa na AI

The Autonomous Fiscal Rule Committee (Carf) warns that the recent 23% minimum wage hike to $2 million—decreed on December 30—could cost $5.3 trillion in 2026 (0.3% of GDP), complicating fiscal sustainability. Labor Minister Antonio Sanguino announced plans to desindex key goods from the wage and provide SME relief to curb inflation.

Ministers in Lula's government, such as Fernando Haddad and Luiz Marinho, are alarmed by the fiscal incentives granted for assembling electric cars at a factory visited by the president and Geraldo Alckmin in Ceará. They view it as a revenue waiver amid a tight budget, without substantial national industry growth. Critics argue the investment fails to create enough jobs to warrant the public policy benefit.

5 Mwezi wa kumi na mbili, 2025 Imeripotiwa na AI

As the Chinese leadership prepares to set the economic agenda for the year ahead, analysts expect Beijing to mostly maintain this year’s policy tone but say it could tolerate a slightly lower growth target. Growth of ‘around 5 per cent’ may be revised to between 4.5 and 5 per cent. The leadership is gearing up for a tone-setting conference.