The South Korean government will keep its expansionary macroeconomic stance until the economy makes a full recovery, the nation's top economic policymaker said on Wednesday.

Although the economic downturn seems to be easing and slowing down, the government needs to keep its expansionary macroeconomic policy stance until the private sector shows an upward turn on its own, South Korean Finance Minister Yoon Jeung-hyun told a forum in Seoul.

"We are still in need of fiscal spending especially when the impact of monetary policies, including interest rate adjustments, remains uncertain," the minister said.

The remarks came as optimistic views on the South Korean economy are growing that the economy is close to bottoming out of the worst downturn in more than a decade, with industrial output rebounding and export decline slowing down.

The minister, however, showed cautions over premature optimism, citing sluggish domestic demand and weak labor market conditions.

The minister said that the government's top priority in the second half is to increase employment and stabilize the economy by implementing the 28.4 trillion won (US$22.8 billion) extra budget approved by parliament last month.

(Xinhua News Agency May 13, 2009)