Only the names changePresident Moon Jae-in unexpectedly replaced his top economic policy aides. Fair Trade Commission (FTC) chief Kim Sang-jo has taken over the policy chief position from Kim Soo-hyun. Lee Ho-seung, first deputy minister for the economy and finance, replaced Yoon Jong-won as the senior presidential secretary for economic affairs. Kim had been in the job for seven months and Yoon for a year. They were in charge of the economy last year when job and business conditions sharply deteriorated. Public disgruntlement has only escalated as the economy worsened over the year with little signs of improvement. The president, until recently, expressed confidence in the economy, but the sudden replacement of his economic chiefs suggests he has finally recognized our grim economic reality.
Yet the surprise announcement of replacements faded into disappointment when the new names were revealed. Kim moving to the Blue House as top policy chief drew more worries than hopes from the business sector. He won the moniker of “chaebol sniper” for his campaigns to reform Korea’s family-run conglomerates during his days as a civic activist. While heading the antitrust agency, his rigidness toward big companies was partly blamed for the deepening worries of Korea Inc. He once demonstrated his distrust of big enterprises by apologizing for his tardiness to a Blue House meeting, saying he had to “teach chaebol a lesson.” He even told the ruling party that there was no need to worry about companies.
The revolving-door appointments do nothing to assuage worries about the president’s stubbornness about his economic policies. Little has changed since he replaced his first economic aides — Jang Ha-sung as policy chief and Hong Jang-pyo as senior economic secretary. Sticking to familiar people could mean no exit from our economic slump.
The data has been a consistent testimony to the failure of Moon’s income-led growth policy over the last two years. The gross domestic product (GDP) decreased by 0.4 percent in the first quarter, the worst performance among OECD members. Institutions in Korea and abroad have been slashing their growth outlooks. Exports and investment have been tumbling. Authorities are slow to adjust to policies — such as the rapid minimum wage hikes and a universal 52-hour workweek rule — despite their negative impact on the economy. The unemployment rate hovers at the worst level since the Asian financial crisis of the late ’90s. Self-employed businesses are falling like dominos, yet the government casually claims things will ameliorate.
Changing personnel is of no use. There must be a radical shift in policy direction. Kim claimed he is flexible and reasonable despite public perceptions otherwise. His appointment could be another catastrophic failure if he fails to prove it.