Minister Yoo defends Park’s economic legacy

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Minister Yoo defends Park’s economic legacy

Finance Minister Yoo Il-ho during a press briefing on Monday defended the economic record of President Park Geun-hye, who was ousted from office after a court approved her impeachment last Friday, and countered widespread criticism that her economic policies have failed.

“I believe that Park Geun-hye’s various policies like reforming the public sector and other areas were well designed,” Yoo said at the Sejong Government Complex. “But at the same time, I feel regret that we were not able to make better improvements in economic growth, youth employment and curbing household debt.”

During the briefing, reporters also asked Yoo to respond to criticism that the Korean government’s reaction to China’s trade restrictions against Korean companies has been weak. Beijing has banned travel agencies from operating tours to Korea and ramped up inspections of Korean companies operating in China, in apparent retaliation against Seoul’s decision to deploy a U.S. missile defense system that has irked Chinese apparatchiks.

Yoo countered there were various factors holding back the Korean government from responding more forcefully, including the lack of open admission from the Chinese government that its trade restrictions are in response to the missile defense system.

“There has been no change to our principle that we will actively react to the Chinese government using various methods, including reporting problems to the World Trade Organization,” Yoo said, “but it is hard for us to do so right now since the Chinese government has not openly said it is taking such trade actions in response to the antimissile system’s deployment.”

Last Tuesday, the government and ruling party agreed to consider complaining to the World Trade Organization about China’s economic retaliations against Korea.

Trade Minister Joo Hyung-hwan in a separate press briefing on Monday said his ministry, too, was closely examining China’s trade actions. “We are having various closed meetings with Korean companies that export to China and listening to their concerns,” Joo said. “We have expressed some of our concerns to the Chinese government through the embassy and told them we would like to have senior-level meetings to discuss the issue.”

Aside from China, the United States is on the government’s radar, as a highly anticipated interest rate increase by the Federal Reserve this month is expected to put further strain on the Korean economy. The Fed’s rate increase will likely put pressure on the Bank of Korea to raise its rates, but doing so will risk expanding the country’s already high household debt.

“There are rising uncertainties from both at home and abroad,” Finance Minister Yoo said, “and we will monitor them closely to reduce their negative impacts and run the economy as stably as possible.”

Last week, Trade Minister Joo visited Washington to meet with his American counterpart, Commerce Secretary Wilbur Ross, to defend the two countries’ five-year-old free trade agreement. His visit came a week after the Office of the U.S. Trade Representative released a report questioning the agreement, citing a dramatic increase in the U.S. trade deficit. Joo countered that both countries have benefited from the FTA.

“I have explained to my American counterpart and other senior officials and politicians that Korea hopes to diversify our export goods,” Joo said.

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