South Korea to spend $13.5 billion over MERS impact

Middle East Respiratory Syndrome-hit country discussing supplementary budget to revive economy

Photo by: Reuters
Photo by: Reuters

Updated Jul 28, 2015

After weeks of subdued spending due to a deadly outbreak of MERS, South Korea is mulling a supplementary budget of at least 15 trillion won ($13.5 billion), according to a second-half economic briefing Thursday.

Finance Minister Choi Kyung-hwan told reporters that the exact figure needs to be decided before a request is handed to the National Assembly next month.

"The economy is being weighed down by MERS, which has seriously hurt consumption and the service sector," said Choi, who was until recently on the frontline of the outbreak as acting prime minister.

His ministry lowered its growth forecast for 2015 to 3.1 percent from an earlier outlook of 3.8 percent, with the local economy also being hurt by drought.

MERS had claimed two more South Korean lives by Thursday morning. Health authorities announced a new death toll of 29 and 180 infections overall since the country's first case last month.

Over three years, the flu-like illness has recorded a fatality rate of more than 40 percent in Saudi Arabia.

Statistics like that have prompted South Koreans to shun public spaces, including shops and other services.

Even so, the viral disease has affected dozens of healthcare settings, and infections are still being confirmed almost every day.

Choi warned Thursday that even when the outbreak is brought under full control "the economy will feel the ill effects for some time to come."