Moon takes on red tape

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Moon takes on red tape

The government has rolled up its sleeves to find a new approach to regulations that may be hampering business innovations and adoption of new technologies. In a discussion on Monday about how to cut red tape and promote innovation, President Moon Jae-in underscored the importance of deregulation. He proposed that new technologies should be allowed to enter the market without regulation, which can be done later when problems are discovered.

Moon highlighted the urgent need to put an end to bureaucracy, citing several cases in which red tape hinders technological innovation on the industrial front. He now seems to understand the significance of deregulation to ramp up what he called “innovative growth” to get the economy out of its doldrums. He pointed out that our auto industry could not roll out electric cars of a very small size simply because they do not belong to any existing car category. Moon cited another example. He lamented that workers and robots cannot work together even now due to the unreasonable requirements that robots should cease to function when workers are around them in the same workplace.

These strange government regulations have made Korea Inc. lag far behind in many global trends. Some pundits even compare Korea’s industrial development to the Galapagos Islands, where evolution takes place in a vacuum. In fact, global business models can hardly take root in such a regulated economy. According to Tech and Law, a global market research agency, more than half of the leaders in various new sectors — including Uber and Airbnb — are either banned or allowed only in a limited way in Korea.

The Lee Myung-bak and Park Geun-hye administrations tried dealing with this problem, but ended up producing empty slogans. They were blocked by the National Assembly and bureaucrats.

Moon showed a determination to end this poor state of affairs. A “revolutionary approach” is needed, he said. Moon denounced bureaucrats for ignoring reality through their conservative interpretation of government regulations. The president said that 32 percent of administrative regulations can disappear by simply changing the way they are interpreted.

The administration must put the president’s resolve into action. It must ease unnecessary regulations to liberalize the markets. Those efforts should be accompanied by labor reforms. The government can put our economy back on track if it pushes deregulation and labor reform at the same time.

JoongAng Ilbo, Jan. 23, Page 30
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