[EDITORIALS]Rekindle economic engineMany Korean citizens are starting the new year with modest hopes that the nation’s economy will improve, and thus their day-to-day living conditions will improve as well. Since they have had to tighten their belts in the last three years, the citizens’ hopes for a better economy for 2006 are earnest. Because of this, the focus of the national administration should be on improving the economy. This upgrade has to come in the form of concrete progress, not just superficial statistics for a rosy future. We will be hard-pressed to maintain our status as a semi-developed country with a growth rate that is below its potential. At this pace, the world’s developed countries will soon be far ahead of us, while the emerging economies of China, India, Russia and Brazil could soon pass Korea as well.
The government is optimistic that our economy will grow by 5 percent, about the same figure as the potential growth rate, but that will not be enough, because the sluggish economy has also slowed down the momentum behind the growth. We have to ensure that we have the potential to grow, not only in 2006, but in the years to come. We have to find future growth engine industries that will keep our economy going for the next few decades.
The current administration’s policy of putting the distribution of wealth ahead of economic growth and of expanding national welfare has lost its effectiveness, as seen in the nation’s overall performance. Without actual growth, there is no welfare and there can be no jobs. The citizens agree that economic growth should be a priority. There is a palpable sense that there is no point wasting any more time debating useless topics.
The problem lies in the government and with politicians. With the regional election scheduled and the pre-election campaign for the 2007 presidential race, the year 2006 will be one of politicking. The upcoming elections have already spawned pledges for policies that favor certain regions. There is the concern that once the elections get closer, the drive to revive the economy will lose much of its force. At the end of last year, President Roh Moo-hyun promised he would give an all-out effort to the national economy in 2005, but he failed to live up to his own words.
In 2006, the economy shouldn’t be left in the dark at the expense of politics, for this is the last opportunity to rekindle the hopes of an economic revival. If the economy is swayed by politics, it will only drag down the people’s livelihood. When this happens, it will not matter who is elected. The Roh administration must show its determination to save the economy and focus all of its effort on it, regardless of the election schedule. Once the government loses its balance, it will be hard to expect our economy to revive in 2006.
An economic growth engine comes from businesses. To accelerate growth, we must create an environment favorable to businesses and encourage their activities. Unless we suppress anti-business sentiment, companies will not be able to do their work. Numerous regulations also form barriers to investment.
Easing regulations is the starting point for improving the economy and expanding the growth engine. We would like to see our businesses resume active capital investments, and our young people hard at work in newsly created jobs.