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Finance minister running for election in the middle of economic reform

Finance minister running for election in the middle of economic reform

Posted October. 16, 2015 09:29,   


The Bank of Korea has lowered its estimation for growth rate this year to 2.7 percent and next year to 3.2 percent, each 0.1 percentage point lowered. It overturned what the government said about Korea`s growth rate exceeding the world average. The International Monetary Fund recently forecast world average growth rate this year to be 3.1 percent while Korea`s growth rate to be 2.7 percent. The domestic consumption has slightly recovered due to spending revitalization event such as "Korea Black Friday," but export is crawling in the slums. In spite of this, Finance Minister Choi Kyung-hwan, when asked if he intended to run for the general election, said, "Well, if it is possible." To the question of the national economy, he replied in a jovial manner, "I am sure there are people who are better than me in economy."

Perhaps he was being honest. But it has been only three months since President Park Geun-hye requested him "to strive for national economy and the economic reform and put personal issues behind." With the president being outside the country, the finance minister should take care of the economy during the president`s absence. But when his mind is outside the economy, what other economic players would want to work hard on the economic reform that he shouts for?

The four reforms that the government is pushing forward have not even been initiated. The labor reform is at a standstill due to the objections from the labor world and the opposition party after the Labor-Management-Government Agreement. The educational reform is also facing a difficulty because of the abrupt history textbook nationalization. The public reform started off trying to eliminate lax management but ended up raising salaries and incentives for executives and staff members of public institutions.

The financial reform seems unfocused between technology banking, FinTech, and improving labor-management relations. During his trip to Peru on Sunday, Finance Minister Choi shook up the banking community, by saying, "The financial reform is not working well. Where else in the world do banks close at 4 p.m.?" His comment was not only incorrect because even banks in advanced countries such as the U.S. and Japan mostly close between 3 and 5 p.m. but also clouding the focus of the financial reforms. Even with some counterarguments that the closing hour was not the point, the minister`s remark seems to have some impact, now that Kookmin Bank and Hana Bank have decided to extend their closing hour.

"`Choi-nomics` was not satisfactory but brought some fruits," Choi, by his own estimation, said on Thursday. "The economic growth rate is improving, and considering the sluggish world economy, we are doing just fine." He may be dreaming about returning to politics, but unfortunately for him, too many Korean people are disappointed at Choi-nomics that started off with razzmatazz in July last year.