Busan is good

Government unveils 'New Deal' investment plans

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Date November 09, 2004  

The government said on Sunday (November 7) that it would rely on pension funds and both private and foreign equity funds next year to help finance large-scale projects to boost the nation's economy.

Finance and Economy Minister Lee Hun-jai told a workshop attended by government officials and lawmakers of the ruling Uri Party that the investment funds would be asked to supplement state spending for the "New Deal" initiatives.

The program will start in the second half of next year, said Lee, reiterating an announcement made Oct. 29 during a seminar with economists.

The New Deal - a reference to giant public works projects used during the U.S. Great Depression in the 1930s - will cost an estimated 10 trillion won, with about 7 to 8 million earmarked by the government.

The entire program is expected to be unveiled next month, however Lee revealed programs that his ministry will initiate. They included a Build-Transfer-Lease system, in which private builders will be allowed to construct schools, social welfare facilities or any other public facilities at their own expense and use them for a set period before transferring ownership to the government.

Foreign equity investment funds will be encouraged to help construct schools and hospitals in the nation's free economic zones, in the port cities of Incheon, Busan and Gwangyang.

The fund for national housing will be encouraged to invest in cultural facilities and public housing.

Pension funds are to be involved in a broad range of construction. The National Pension Fund will be used to invest in the construction of centers for infants and the elderly and in public medical facilities and expressways.

Private school teachers will see their pension fund used to invest in the construction of college dormitories and facilities at elementary and secondary schools, such as swimming pools. The pension fund for government officials is to be allowed to invest in the building of training centers for government officials and public buildings for provincial governments.

The Finance Ministry will also arrange for the Korea Electric Power Corp., the Korea Housing Corp. and other state-run firms to increase investment by 1.5 trillion won ($1.3 billion) next year.

The Ministry of Information and the Ministry of Science and Technology will also develop their own "digital new deal" project, where the databases for state and public documents and assets will be established through massive investment, setting up a disaster management system and broadening the information base. The government will also increase investment in technology for saving energy and recycling.

 

The source of news :  news.go.kr