The government plans to spend 3 trillion won ($2.67 billion) more in the first half to stimulate the slow pace of economic recovery and increase public investment by around 7 trillion won within the year, South Korea's finance minister said Friday.
  

Choi Kyung-hwan said at the meeting of economy-related ministers held in Seoul that the new measures are needed due to weak consumption and an unsteady rise in corporate investment, brought on by weak demand.
  

Facility investment by companies contracted 7.1 percent in January compared with the previous month, with import of machinery down 1.2 percent on-year. Both numbers are a sign that business investments, which have been on the rise since September, are being scaled back, Retail sales were in negative territory by 3.1 percent in the first month of this year, with exports backtracking in January and February compared with the year before.
  

"The economy is showing signs of gradual improvement, but gains are not solid so action must be taken," he stressed.
  

The policymaker said 59 percent of the budget will be spent before the end of June, up from the previously targeted 58 percent. This translates into the government injecting 2 trillion won more into the economy.
  

In addition, another 1 trillion won will be acquired from the 46 trillion won economic stimulus package created last October.
  

Initially, the government wanted to spend 5.5 trillion won in the first half.
  

The official, who doubles as deputy prime minister, also said public corporations will increase investment by 1.4 trillion won, with money saved from a drop in international crude prices. State funds allocated to promoting corporate investment will be raised from 10 trillion won to 15 trillion won, and 500 billion won will go to jumpstarting projects that need monetary support. Such measures could allow roughly 7 trillion won more to be injected into various projects this year.
  

Choi said that the government plans to reform public-private partnership projects and help find new private sector investment opportunities that can benefit the economy.
  

The official then said that a rise in unemployment among young people is worrisome and argued that the dual structure of the country's labor market is one of the main causes of this impasse
  

The dual labor market refers to the social gap between full-time regular employees with stable jobs and non-regular workers who have far less job security and are paid less. Because the latter is paid less and has less stable employment, most job seekers have flocked to regular positions that are hard to get.
  

Last month unemployment among people between the ages of 15 and 29 reached 11.1 percent compared with 9.2 percent in January.
  

"To tackle this issue, there is a pressing need for businesses, labor and all interested parties to find a compromise on reforming the labor market," Choi said.
  

He vowed that every effort will be made to iron out a deal on labor reforms by the end of the month.
  

Related to the high jobless rate, the official said an outlet can be found by encouraging young people to find work abroad.
  

The government said it will come up with a plan within the first half to help young people with skills in health care, information technology and cultural contents find overseas employment. (Yonhap)