South Korea’s parliament has approved a massive supplementary budget aimed at cushioning the economic shock from rising global tensions and disruptions linked to the Middle East conflict.
The National Assembly of South Korea on Friday passed a 26.2 trillion won ($17.7 billion) extra spending plan during a plenary session, just 10 days after it was formally proposed by the government. The bill received overwhelming support, with 214 lawmakers voting in favour, 11 against, and 19 abstaining out of 244 members present.
The bipartisan approval reflects rare political unity between the ruling Democratic Party of Korea and the main opposition People Power Party, both of which agreed to retain the original size and scope of the government’s proposal.
A key component of the package is direct financial support for citizens. Lawmakers approved cash assistance for roughly 35.8 million people, targeting the lowest 70% of income earners. Depending on income level and region, beneficiaries will receive between 100,000 and 600,000 won to help offset the rising cost of living driven by surging oil prices.
In addition, the budget allocates 200 billion won to stabilize the supply of naphtha, a critical petrochemical feedstock used by major industries. Authorities say this measure is essential to prevent disruptions in manufacturing and exports.
Presidential spokesperson Kang Yu-jung welcomed the swift passage of the bill, praising lawmakers for prioritizing national interest amid growing economic uncertainty.
The approval comes after Lee Jae-myung, South Korea’s president, described the situation caused by the Middle East conflict as being at a “wartime-level,” warning of a complex economic crisis driven by energy supply shocks and global instability.
The government is now expected to rapidly implement relief measures. These include subsidies for fuel purchases by farmers and fishermen, public transport discounts, and targeted support for industries heavily dependent on energy imports.
South Korea’s vulnerability to external shocks has been underscored by recent disruptions in oil supply routes. Imports of crude oil through the Strait of Hormuz—a vital global shipping lane—have reportedly been halted for more than 10 days following heightened tensions in the region. The last shipment from the route arrived in the country on March 20.
In response, Seoul has already issued a second-level national energy security alert and is considering additional conservation measures, including traffic control policies, to reduce fuel consumption.
Analysts say the emergency budget highlights the scale of the economic risks posed by geopolitical instability, particularly for energy-dependent economies like South Korea. The swift legislative action is seen as an effort to stabilize domestic markets, protect vulnerable households, and shield key industries from prolonged disruption.
