Han Duck-soo, minister for government policy coordination and a former trade minister, was appointed today as South Korea’s new finance minister.

The new South Koren finance minister is expected to continue with the policy of low interest rates and increased public spending in order to spur domestic demand.

"Much of the country’s economic policy has already been set by Roh’s government and the previous finance minister, so Han is expected to follow in their footsteps," says Choi Yong-kyu, a fund manager at KEB Commerz Investment Trust Management.

Slowdown in consumer spending is expected to lead to a drop in GDP growth to 4% in 2005 from 4.7% in 2004.