South Korea approves welfare-focused budget

Updated 02 January 2013
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South Korea approves welfare-focused budget

SEOUL: South Korea's Parliament yesterday approved a revised government budget for 2013 that focuses more on welfare in response to the next president's pledge to increase social spending.
The legislature ratified total spending of 342 trillion won ($ 319.46 billion), down from the government's proposal of 342.5 trillion.
It marked the first time in South Korea's history that a budget bill has been approved after the beginning of the fiscal year, which is the same as the calendar year.
The revised budget calls for cutting defense expenditure while spending more on social welfare and public construction projects.
Incoming President Park Geun-Hye, who takes office next month, has promised to expand free child care, subsidize college tuition fees and increase support for the poor.
Welfare spending this year will reach about 100 trillion won, higher than the government's proposal of 97 trillion won.
Rival parties had pushed for a bolder fiscal policy to stimulate the economy but reached a deal with the government to save any such measures for the future.
The Finance Ministry has delayed its plan to achieve a balanced budget by a year until 2014. The country's overall sovereign debt was estimated at 34 percent of gross domestic product in 2012.
Meanwhile, South Korea's trade surplus in 2012 shrank 7.1 percent to $ 28.6 billion in 2012, data showed yesterday, as exports were hit by shrinking demand in the key European market.
Overseas shipments fell 1.3 percent to $ 548.2 billion last year, while imports slipped 0.9 percent to $ 519.5 billion, the Ministry of Knowledge Economy said.
The 2012 trade surplus figure is down from $ 30.8 billion in 2011 and well off the $ 41.2 billion in 2010, it said.
In December alone, exports fell 5.5 percent from a year ago to $ 45.1 billion and imports retreated 5.3 percent to $ 43.07 billion.
Shipments to Europe in 2012 plunged 12.5 percent year-on-year to $ 47.6 billion, while exports to top destination China, which suffered a slowdown in growth during the year, fell 0.1 percent to $ 130 billion.
The numbers come a day after official figures showed inflation slowed to a four-month low of 1.4 percent in December, giving the central bank leeway to loosen monetary policy to boost economic growth.
Bank of Korea policymakers left the key interest rate unchanged at 2.75 percent in a meeting last month, after trimming it twice throughout the year.
South Korea's economy expanded at its slowest pace in three years in the three months to September, hit by falling demand overseas, with Europe gripped by a debilitating debt crisis. The government has warned that 2013 will likely be equally tough.


Oil prices edge up, but set for weekly loss on inventory build, US-China trade row

Updated 55 min 1 sec ago
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Oil prices edge up, but set for weekly loss on inventory build, US-China trade row

  • US crude stocks last week climbed 6.5 million barrels, the fourth straight weekly build, almost triple the amount analysts had forecast
  • An unprecedented volume of Iranian crude oil is set to arrive at China’s northeast Dalian port this month

SINGAPORE: Oil prices nudged higher on Friday on signs of surging demand in China, the world’s second-biggest oil user, though prices are set to fall for a second week amid concerns of the ongoing Sino-US trade war is limiting overall economic activity.
Brent crude oil futures were trading at $79.51 per barrel at 0521 GMT, up 22 cents, or 0.3 percent, from their last close.
US West Texas Intermediate (WTI) crude futures were up 19 cents, or 0.3 percent, at $68.84 a barrel.
For the week, Brent crude was 1.1 percent lower while WTI futures were down 3.5 percent, putting both on track for a second consecutive weekly decline.
Refinery throughput in China, the world’s second-largest oil importer, rose to a record high of 12.49 million barrels per day (bpd) in September as some independent plants restarted operations after prolonged shutdowns over summer to shore up inventories, government data showed on Friday.
The refinery consumption may rise through the fourth quarter as several state-owned Chinese refiners return to service after maintenance.
Undermining the strong refinery data, China did on Friday report its weakest economic growth since 2009 in the third quarter, with gross domestic product expanding by only 6.5 percent, missing estimates.
The weak economic data raised concerns that the country’s trade war with United States is beginning to have an impact on growth, which may limit China’s oil demand.
The trade war concerns combined with surging US oil stockpiles reported on Thursday are capping the day’s price gains.
US crude stocks last week climbed 6.5 million barrels, the fourth straight weekly build, almost triple the amount analysts had forecast, the US Energy Information Administration said on Wednesday.
“EIA Weekly Petroleum Status Report was a complete shocker sending Oil markets spiraling lower amidst some concerning development for oil bulls,” said Stephen Innes, head of trading APAC at OANDA in Singapore.
Inventories rose sharply even as US crude production slipped 300,000 barrels per day (bpd) to 10.9 million bpd last week due to the effects of offshore facilities closing temporarily for Hurricane Michael.
Meanwhile, Iranian oil exports may have increased in October when compared to the previous month as buyers rush to lift more cargoes ahead of looming US sanctions that kick in on Nov. 4.
An unprecedented volume of Iranian crude oil is set to arrive at China’s northeast Dalian port this month and in early November before US sanctions on Iran take effect, according to an Iranian shipping source and data on Refinitiv Eikon.
So far, a total of 22 million barrels of Iranian crude oil loaded on supertankers owned by the National Iranian Tanker Co. are expected to arrive at Dalian in October and November, the data showed. Dalian typically receives between 1 million and 3 million barrels of Iranian oil each month, according to data that dates back to January 2015.