Finance Minister Bahk drops ball on the economy
By Kim Jae-won
When facing difficult questions, Strategy and Finance Minister Bahk Jae-wan, a self-confessed sports fanatic, has a habit of making baseball analogies.
As the country’s top economic policymaker, he describes himself as a ``catcher’’ who calls the game from behind the plate or a ``closer,’’ the ace relief pitcher who comes out of the bullpen to navigate his team out of trouble.
The difficult quandary of slow growth and higher prices has reduced the options in economic policies and forces him to play ``small ball,’’ with the batters hitting for content and runners aggressive on the bases, instead of swinging big in search of an extra-base hit or homeruns.
Well, whatever he is and whatever he has been doing, Bahk’s ability as a player appears to rank somewhere between average and disappointing.
Taking the job in the first-half of 2011 when the country first showed signs of folding under the pressure of the eurozone debt crisis and toxic household finances, it was apparent from the beginning that Bahk had his work cut out for him.
And after 12 under-whelming months as the man calling the shots at the Gwacheon government complex, it’s tempting to say that Bahk has been a failure at least so far.
Korean economy grew 3.6 percent last year, down from 6.2 percent in 2010. Economists say that the growth rate of the gross domestic product (GDP) will even plunge more this year marking in the low-3s.
The benchmark Korea Composite Stock Price Index (KOSPI) closed at 1,834.51 Friday, down 13 percent from a year ago as foreign investors continue to run from the country screaming.
The value of the local currency has been skidding as well. The Korean won finished at 1,177.7 won Friday to the U.S. greenback, down 100 won or 9 percent from the previous year. The local currency repeated the same pattern this time losing its value against major currencies during the financial turmoil as it has little convertibility in the international market.
Of course, it would be inappropriate to blame Bahk for the worsening global conditions that are rattling Korea’s export-dependent economy, factors Bahk obviously has no control over. But it’s equally hard to see what Bahk actually did to combat the instability or whether his goal was merely to avoid making things worse.
As the chief of the nation’s fiscal policy, Bahk can’t avoid criticism that the nation’s firewall against offshore shocks is still weak and needs to be repaired.
Korea suffered from liquidity crises in the Asian financial crisis in the late 1990s and the global financial crisis in 2008. Big fluctuations in the stock and foreign exchange markets show that the country is still exposed to similar danger.
In terms of employment, Bahk complained that the media and the public do not recognize the ministry’s efforts to create more jobs.
“Korea is the only country whose number of employment increased for four years from 2007 to 2011 except Germany. U.S. and Japan saw their employment drop to 6.2 million and 1.6 million, respectively, while number of jobs increased 810,000 in Korea,” Bahk told reporters in a meeting last month.
The minister was proud of the statistics, but it is a million miles away from the public’s sentiment as they suffer from a lack of quality jobs and insecure working conditions.
We live in a country where a youth feels no shame to say that he has no job because everybody else is in the same boat. More than half of the nation’s workers are contract or temporary employees who are in danger of becoming jobless at anytime.
People want to listen to the minister’s solutions to tackle the unemployment matter, not an excuse or praise for the government.