As Deputy Prime Minister for Economic Affairs Choi Kyung-hwan'(photo)s resignation is imminent due to his bid in next year's general elections, an assessment of his seventeen months in office is in full swing. As an influential figure, Choi had pushed through with his economic policies, unusually referred to as "Choi-nomics." However, Choi's economic policy was, simply put, a growth policy totally reliant on support. Choi drove the budget into a deficit and even drew resources from public funds and public enterprises.
In addition to all kinds of deregulation, Choi pressured the Bank of Korea to lower the base interest rate and tried to stimulate our economy by drawing in even private debt. In the early days, his policies were accepted in a positive light, but they soon revealed their limits. South Korea's economic growth rate this year is in the 2% level. The embers of consumption remain weak, and there is no news of investment. The real estate market has reached a point where some now worry about overheating, but it has failed to stimulate our economy. Meanwhile, the country's debt and household debt have snowballed.
Such a debt-driven growth policy has already boomeranged back. The government belatedly mentioned strengthening real estate regulations, but finds its hands tied for the U.S. interest rate hike may pour cold water on the market. Eventually, the government's plans to pay off the loans when the situation gets better and in the meantime just buy time by taking out another loan to pay off an existing loan missed the mark, and now it is difficult to make any guarantees about the future. The lives of the ordinary citizens have also become barren. Plans to revive the economy by increasing household income ended in a feast of words.
The government's effort to stimulate the real estate market only ended in raising housing prices and making it more difficult for people to find affordable housing to rent. The government says that when the National Assembly passes the five labor-related bills, jobs will grow and the economy will revive, but businesses will be able to lay off workers more easily and more industries will be able to hire irregular agency workers, driving the workers into a tougher situation.
On Tuesday, the Organization for Economic Cooperation and Development (OECD) said that the trickle-down effect of large companies in South Korea has reached its limit and warned that the current policy would only intensifying polarization. Such an analysis has already become common knowledge in the international community. Choi's failure was due to an idle approach, unable to respond sensitively to the structural changes in the domestic and international economic situation, viewing the economic recession as part of a circulatory trend and thinking that growth and the trickle-down effect would solve everything. We must now change the perspective from which we view the economy. Even if the economy grows at a fast rate, it is useless if the quality of life drops. The answer is obvious. President Park Geun-hye must return to where she first began. Back then, the president had said she would foster small and medium-sized enterprises by deviating from the large business-centered economic structure through "economic democratization" and stabilize the people's financial situation by securing jobs and reducing household debt. No need to mention that she also said she would strengthen requirements for layoffs and have irregular workers switch to regular workers. President Park now has slightly over two years. It is now time for "Park Geun-hye-nomics."
In addition to all kinds of deregulation, Choi pressured the Bank of Korea to lower the base interest rate and tried to stimulate our economy by drawing in even private debt. In the early days, his policies were accepted in a positive light, but they soon revealed their limits. South Korea's economic growth rate this year is in the 2% level. The embers of consumption remain weak, and there is no news of investment. The real estate market has reached a point where some now worry about overheating, but it has failed to stimulate our economy. Meanwhile, the country's debt and household debt have snowballed.
Such a debt-driven growth policy has already boomeranged back. The government belatedly mentioned strengthening real estate regulations, but finds its hands tied for the U.S. interest rate hike may pour cold water on the market. Eventually, the government's plans to pay off the loans when the situation gets better and in the meantime just buy time by taking out another loan to pay off an existing loan missed the mark, and now it is difficult to make any guarantees about the future. The lives of the ordinary citizens have also become barren. Plans to revive the economy by increasing household income ended in a feast of words.
The government's effort to stimulate the real estate market only ended in raising housing prices and making it more difficult for people to find affordable housing to rent. The government says that when the National Assembly passes the five labor-related bills, jobs will grow and the economy will revive, but businesses will be able to lay off workers more easily and more industries will be able to hire irregular agency workers, driving the workers into a tougher situation.
On Tuesday, the Organization for Economic Cooperation and Development (OECD) said that the trickle-down effect of large companies in South Korea has reached its limit and warned that the current policy would only intensifying polarization. Such an analysis has already become common knowledge in the international community. Choi's failure was due to an idle approach, unable to respond sensitively to the structural changes in the domestic and international economic situation, viewing the economic recession as part of a circulatory trend and thinking that growth and the trickle-down effect would solve everything. We must now change the perspective from which we view the economy. Even if the economy grows at a fast rate, it is useless if the quality of life drops. The answer is obvious. President Park Geun-hye must return to where she first began. Back then, the president had said she would foster small and medium-sized enterprises by deviating from the large business-centered economic structure through "economic democratization" and stabilize the people's financial situation by securing jobs and reducing household debt. No need to mention that she also said she would strengthen requirements for layoffs and have irregular workers switch to regular workers. President Park now has slightly over two years. It is now time for "Park Geun-hye-nomics."
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