By Lee Hyo-sik
Strategy and Finance Minister Choi Kyung-hwan is looking for ways to fuel his growth strategy which is dragging only two months after took office with a series of stimulus measures.
Stock prices have collapsed, dropping the KOSPI below 2000, while the property market with almost all restrictions lifted has failed to show any improvement.
Choi, a confidant of President Park Geun-hye, knows blaming the strong dollar and uncertainties in the Middle East and Ukraine will not suffice.
That means there are more growth-oriented policies to come, perhaps starting with a package of measures to boost the swooning stock market.
Financial Services Commission Chairman Shin Je-yun already promised one this month after participating in a ruling Saenuri Party Supreme Council meeting.
Already, the possibility of an immediate rate cut is gaining credence.
But could these measures prove to be enough to sustain "Choinomics," a growth policy named after the finance minister?
''It is true that Choinomics has lost its magic largely because of unfavorable external economic conditions,'' said Daniel Cho, head of research at Daishin Securities. ''However, if the finance minister continues to send a message to the market that the government is serious about revitalizing the economy, the efficacy of his policies may kick in again.
"Government officials must first gain market trust. To do so, they have to carry out policies in a coherent manner," Cho said. ''For the stock market, the government should reduce equity transaction costs and allow more high-income earners to subscribe to tax-exempt installment funds.''
These could serve as an extension of the policies he put in place when he got into office.
At that time, Choi pressed companies to pay more dividends, while easing mortgage rules to rescue the struggling property market.
On Thursday, the KOSPI closed at 1,976.16, down 15.38 points from the previous day.
Foreign investors dumped local shares as the strengthening dollar has made Korean stocks less attractive.
In early September, the won-dollar rate hovered around 1,020 won, but the won since then has been weakening against the greenback. On Thursday, it closed at 1,060.9.
The Japanese yen has been weakening against the dollar, the won and other currencies, making Korean products more expensive in the global market.
According to Statistics Korea, industrial production contracted 3.8 percent in August from July, the steepest month-on-month decline since December 2008 when the output plunged 10.8 percent, as exporters struggled abroad due to the yen's weakness.
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| Choi Kyung-hwan |
Stock prices have collapsed, dropping the KOSPI below 2000, while the property market with almost all restrictions lifted has failed to show any improvement.
Choi, a confidant of President Park Geun-hye, knows blaming the strong dollar and uncertainties in the Middle East and Ukraine will not suffice.
That means there are more growth-oriented policies to come, perhaps starting with a package of measures to boost the swooning stock market.
Financial Services Commission Chairman Shin Je-yun already promised one this month after participating in a ruling Saenuri Party Supreme Council meeting.
Already, the possibility of an immediate rate cut is gaining credence.
But could these measures prove to be enough to sustain "Choinomics," a growth policy named after the finance minister?
''It is true that Choinomics has lost its magic largely because of unfavorable external economic conditions,'' said Daniel Cho, head of research at Daishin Securities. ''However, if the finance minister continues to send a message to the market that the government is serious about revitalizing the economy, the efficacy of his policies may kick in again.
"Government officials must first gain market trust. To do so, they have to carry out policies in a coherent manner," Cho said. ''For the stock market, the government should reduce equity transaction costs and allow more high-income earners to subscribe to tax-exempt installment funds.''
These could serve as an extension of the policies he put in place when he got into office.
At that time, Choi pressed companies to pay more dividends, while easing mortgage rules to rescue the struggling property market.
On Thursday, the KOSPI closed at 1,976.16, down 15.38 points from the previous day.
Foreign investors dumped local shares as the strengthening dollar has made Korean stocks less attractive.
In early September, the won-dollar rate hovered around 1,020 won, but the won since then has been weakening against the greenback. On Thursday, it closed at 1,060.9.
The Japanese yen has been weakening against the dollar, the won and other currencies, making Korean products more expensive in the global market.
According to Statistics Korea, industrial production contracted 3.8 percent in August from July, the steepest month-on-month decline since December 2008 when the output plunged 10.8 percent, as exporters struggled abroad due to the yen's weakness.
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