Deregulation first

The state-run think tank Korea Development Institute (KDI) advised that the government should first reform regulations in order to stimulate innovations for economic growth. “The layers of regulations and barriers get in the way of innovations and start-ups. They must be lifted for the government to achieve innovation-led growth,” said Lee Su-il, KDI director of the Center for Regulatory Studies.

The think tank went on to criticize the government’s secretive way of making policies. It said that public policy will lose credibility if it is not based on sure facts. Lee cited the scandal over pesticide-tainted eggs.

The European Union recommended that the governments of member countries, where eggs were found to have pesticides exceeding guidelines, take actions according to the contamination level. But Korea ordered farms to do away with entire yields regardless of their contamination limits and caused more harm to the farms and an unnecessary scare among consumers.

Appropriate actions are not possible because they are not based on scientific facts or market trends, the think tank said. This is because public officials are defensive about sharing information in fear of receiving criticism or punishment. About 88 percent of experts on the economy believed that the Korean economy was like a frog in boiling water, while 63 percent said it has one or three years left at best to escape.

It is uncertain whether the government will pay heed to the KDI warning. The think tank produced two deputy prime ministers in charge of the economy as well as ministers and senior presidential secretaries in past conservative government. The new government has not turned to the institute for recruitment. The research institute remains not only geographically far from Seoul as it is located in Sejong City, but it also appears to have lost favor with the liberal government. But policymakers need to listen more closely to the think tank as its primary role is to make policy recommendations and directions.

JoongAng Ilbo, Nov. 4, Page 30