Lee Pushes Measures for Struggling Builders
By Na Jeong-ju
Staff Reporter
President Lee Myung-bak indicated Tuesday that his administration will ease rules on reconstruction of old houses to prop up the slumping housing industry, saying builders will create more jobs through redevelopment and reconstruction projects.
``The construction industry is a crucial part of the economy,'' Lee said at a Cabinet meeting at the Gwacheon Government Complex in Gyeonggi Province. ``The government needs to begin reconstruction and redevelopment projects to provide builders with opportunities to create more jobs and play a larger role for economic growth.''
The government has maintained tough regulations on reconstruction and redevelopment as part of efforts to stabilize the housing industry.
However, construction firms recently suffered a sharp fall in their income as demand for homes has dropped sharply amid rising interest rates and skyrocketing property taxes. An increasing number of builders have gone bankrupt.
On Aug. 21, the government unveiled plans to build two additional satellite cities near Seoul to increase the housing supply in the capital and adjacent areas and to assist struggling builders.
``It is important to vitalize the construction industry to spur economic growth and provide more job opportunities,'' said Lee, a former CEO of the country's largest builder, Hyundai Engineering & Construction.
There is criticism that such moves may inflate a housing bubble, but senior officials share the view that pump-priming measures are necessary at the moment to help builders see a turnaround, Cheong Wa Dae officials said.
It was the first time for the President to hold a Cabinet meeting in the Gwacheon Government Complex, which houses economy and finance-related ministries. After the meeting, Lee visited the ministries to encourage officials.
``The latest Cabinet meeting shows Lee's determination to overcome the external negatives weighing on the economy,'' a presidential spokesman said. ``The President instructed officials to set up countermeasures on concerns about a liquidity crisis and the won's sharp fall against the dollar.''