SEOUL, Aug 30 Reuters South Korea said on Tuesday it would cut annual government spending for the first time in more than a decade next year, as it strives to cut back on pandemicera stimulus and help the central bank temper inflationary pressures.

Unveiling the first budget proposal under rightleaning President Yoon Sukyeol, the finance ministry said government expenditure will be 639 trillion won 473 billion in 2023.

That is 6 smaller than this year39;s spending after two supplementary budgets, and would be the first annual decline in spending since 2010, assuming there are no additional budgets for 2023.

Excluding extra budgets, South Korea39;s 2023 spending will grow by 5.2, the slowest since 2017.

The move marks a shift away from aggressive fiscal spending under predecessor Moon Jaein39;s leftleaning government in recent years and from the massive stimulus measures taken during the pandemic to help the economy withstand the COVID19 crisis.

The Bank of Korea, which has been at the forefront of a global tightening cycle, has raised interest rates by a total of 2 percentage points since August last year.

By contrast, governments from Australia to Canada have continued expansionary fiscal policies so far even as their central banks have raised rates to tackle soaring inflation.

The government is shifting its fiscal policy stance completely to 39;sound financing39; to secure fiscal sustainability, improve external credit standing and spend responsibly for future…