Government is targeting unreasonable regulations

Korea’s government will unveil policies within days to remove “unreasonable” regulations that deter companies from making investments, Finance Minister Hyun Oh-seok said yesterday.

The government also is preparing measures, including loans and marketing support, to help smaller exporters grappling with the sliding yen, the Ministry of Strategy and Finance said in a separate statement Sunday.

President Park Geun-hye announced a $15 billion extra budget and property stimulus package this month and the central bank pared its growth forecast for this year as a decline in the yen hurts exporters and record household debt restrains consumption. Hyun said last week the government plans policy support for service industries to boost job creation.

“Weak private consumption and inventory drawdown suggest a still slower recovery in private demand, which makes the coordination of policy stimulus all the more important,” Kwon Goo-hoon, a Goldman Sachs Group economist, wrote in a report last week after first-quarter economic growth rose the most in two years, driven by front-loading of fiscal spending by the government and higher exports.

“We’re trying to do a major easing of rules to revitalize investment,” Hyun said yesterday during a meeting with heads of small and medium-size manufacturers in Siheung, southwest of Seoul. The measures will target increasing “facility investments” by smaller firms through financial incentives, he said.

The Finance Ministry warned in its statement Sunday that April exports of vehicles and other goods may rise only 1 percent to 2 percent from a year earlier.

In an interview April 18, Hyun said the weakening yen hurt the Korean economy more than threats from North Korea. Bloomberg