World Bank chides Korean government's market intervention

The International Bank for Reconstruction and Development(IBRD), better known as the World Bank, recommended that the Korean government should refrain from direct intervention in the market economy and change its policy to promote the ingenuity of the market if Korea wants to shift to an advanced knowledge-based economy.

According to the Ministry of Finance and Economy, a report about Korea`s shift to a knowledge-based economy, which was jointly prepared by the World Bank and the Organization for Economic Cooperation and Development(OECD), stressed that it is necessary for Korea to soften restrictions on education and information infrastructure.

The World Bank pointed out Korea`s major policy goals such as system improvement to strengthen the market mechanism, improvement in the educational system including better educational autonomy, arrangement of infrastructure for informationization, and quality improvement in research and development.

Also, the World Bank indicated that the Ministry of Information and Communication tends to initiate industrial development, although there is marked improvement in easing restrictions on the fields of information infrastructure. It recommended that the nation shift to a system in which the private sector is responsible for the market through liberalization of the communications service industry and the lifting of restrictions on local phone service.