[Yoon Administration Economy] Choo Kyung-ho: "Bold Shift of Economic Policy from 'Government-led to Private Sector'"

Economic Policy Direction

Deputy Prime Minister and Minister of Economy and Finance Choo Kyung-ho is announcing the new government's economic policy direction at the briefing room of the Government Seoul Office Building on June 16, 2022. Photo by Yonhap News.

[Asia Economy Sejong=Reporter Son Seon-hee] Deputy Prime Minister and Minister of Economy and Finance Choo Kyung-ho said on the 16th, "The new government intends to boldly shift the government-led economic management policy to overcome the current complex economic crisis and lay the foundation for overcoming low growth."

Deputy Prime Minister Choo made this remark at a joint government briefing on the 'New Government Economic Policy Direction' held at the Government Seoul Office. Regarding the recent economic situation, he stated, "We are facing a complex crisis situation where concerns about economic slowdown amid high inflation are expanding," and diagnosed, "Due to government- and fiscal-led economic management and excessive regulations, domestic investment by companies has shrunk while overseas investment has surged, leading to a decline in private sector vitality and significantly weakening the private sector's ability to generate growth and jobs." He also mentioned structural issues such as population decline, adding, "The Organization for Economic Cooperation and Development (OECD) warns that our economy's potential growth rate has sharply fallen to around 2%, and if this continues, it could plummet to the 0% range within 10 years."

Deputy Prime Minister Choo presented the four major pillars of the new government's economic management to overcome this as 'freedom, fairness, innovation, and solidarity,' emphasizing, "We will focus on four directions: a private sector-centered dynamic economy, a structural reform leap economy, a future-prepared leading economy, and a happiness economy that progresses together, and will promote economic policies accordingly."

He said, "We will restore economic vitality and dynamism by shifting economic management from government-centered to private, corporate, and market-centered," highlighting bold regulatory reforms, lowering the top corporate tax rate to 22%, and tax support for core strategic technologies such as semiconductors. He added, "To upgrade the growth path of our economy, we will strongly push forward structural reforms in five major sectors: public, labor, education, finance, and services." Additionally, he mentioned strengthening welfare for vulnerable groups along with future tasks such as fostering science and technology and responding to population and climate crises.

Deputy Prime Minister Choo said, "It is unlikely that the complex economic crisis will end within one to two months, and the pattern of economic slowdown amid high inflation is expected to continue for a considerable period," calling it "the beginning of a long march of 'economic war'." He continued, "The government will mobilize all possible policy measures to prioritize stabilizing people's livelihoods and prices, while also making every effort to enhance growth potential through improving the economic structure," reiterating his commitment.