Moon reshuffles top secretaries for economics

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Moon reshuffles top secretaries for economics


The Blue House on Tuesday named three new senior presidential secretaries for economic affairs, job creation and civil affairs in its first reshuffle of Blue House secretaries since it took power in May 2017.

Yoon Jong-won, currently head of South Korea’s mission to the Organization for Economic Cooperation and Development after years at the Ministry of Strategy and Finance, was appointed senior secretary for economic affairs, replacing Hong Jang-pyo, considered the architect of the Moon Jae-in administration’s income-led growth policy along with Jang Ha-sung, the president’s policy chief.

Jung Tae-ho, who previously served as presidential secretary for policy planning, was named senior secretary for job creation in place of Bahn Jahng-shick. For civil affairs, Lee Yong-sun, an official of the ruling Democratic Party, was named senior secretary.

Im Jong-seok, President Moon’s chief of staff, said the reshuffle reflected the government’s resolve to “accelerate the policy of income-led growth” in its second year in office so that the public could actually “feel the impact” of the policies implemented.

“The past one year has been a period for the Moon Jae-in government to set in place its policy direction defined by income-led growth, innovation-led growth and a fair economy,” Im said at a press briefing at the Blue House. “Now entering the second year in office, the government will strive to make Koreans feel [the positive] impact of policies by accelerating the implementation of income-led and innovation-led growth policies,” he continued.

He noted that Yoon was expected to take the lead in carrying out Moon’s overall economic policy considering his “high understanding” of the philosophy behind income-led growth and innovation-led growth, two pillars of the Moon government’s economic agenda. Yoon has emphasized the importance of an economic paradigm that puts people at the center of a sustainable economy as a veteran policy planner in the Finance Ministry, Im noted.

The reshuffle of senior secretaries for economic affairs and job creation came amidst growing alarm over the direction of the economy, with employment data worsening every month.

Recent government data showed that the Korean economy added 72,000 new jobs in May, the lowest increase in eight years and four months. In the same month, Korea’s youth unemployment rate rose by 1.3 percentage points to 10.5 percent, the worst figure for May ever recorded. Using terms rarely used by a senior government official, Kim Dong-yeon, the minister for strategy and finance and deputy prime minister for the economy, described the economic data as “shocking” and said the government’s economic team, including himself, was responsible for the situation.

The reshuffle of Hong Jang-pyo, a strong advocate of the income-led growth policy, fueled speculation that he was dismissed from his position 11 months after he assumed it to take responsibility for the negative impact of a dramatic hike in Korea’s minimum wage, especially on small to medium size businesses.

Under the income-led growth policy, the minimum wage was raised by 16.4 percent this year, the largest increase since 2001, to 7,530 won ($6.75) from last year’s 6,470 won.

The replacement of Hong by Yoon, who hails from the Strategy and Finance Ministry like Finance Minister Kim, has fueled speculation that the balance of power might tilt toward Kim from Jang Ha-sung, a well known champion for an increased minimum wage. Kim has been cautious about raising the minimum wage.

With the reshuffle, Hong is named head of the newly created income-led growth special committee run under the Blue House.

“President Moon gave a special order to Hong to lay down a detailed road map for a long-term plan for the income-led growth policy as head of the income-led growth special committee under the presidential commission on policy planning,” said Im.

While Hong has taken a new role, Tuesday’s reshuffle is largely seen as Moon’s punitive dismissal of Hong over disappointing economic data in recent months.

Moon also appointed Song In-bae, his personal affairs secretary, as secretary for political affairs, a position that gives the president’s confidant the ability to communicate with opposition parties. The opposition believes that Song was involved in an online manipulation scheme known as the Druking case. Song is suspected of having met a power blogger named Druking several times and introducing the blogger to Kim Kyoung-soo, the governor-elect of South Gyeongsang.

Moon’s appointment of Song as a political affairs secretary appears to have reaffirmed the president’s trust in his longtime aide.

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