Jun Ji-hye, a reporter at the finance desk of The Korea Times, focuses primarily on economic policy and government agencies, mainly covering the Ministry of Finance and Economy, the Ministry of Budget and Planning, the National Tax Service and the Korea Customs Service. She previously covered financial authorities, including the Financial Services Commission and the Financial Supervisory Service, and earlier worked on the political, city and business desks, reporting on a wide range of issues.
Park aims at 1% rise in growth potential
By Jun Ji-hye
Park Geun-hye
By Jun Ji-hye
Strategists working for Rep. Park Geun-hye, presidential candidate of the ruling Saenuri Party, said Sunday that they mulled ways to boost the economy’s growth potential by 1 percentage point higher, enough to tackle jobless growth.
A potential growth rate has become a buzzword for the Park campaign. It refers to the possible production and output of the economy without causing inflation or other economic friction and distortion.
“The economy’s potential growth rate has hovered some 3.5 percent over the past years and this trend is expected to go on until 2016. After that, it is projected to drop,” Kim Kwang-doo, a ranking strategist of the economic committee of the Park camp, said.
“Our goal is to boost the rate 1 percentage point higher so that an average 4.5 percent of growth potential is achieved. Jobless growth cannot be solved if the potential growth rate remains at 3.5 percent.”
The Park side said their pledge is different from President Lee Myung-bak’s vision calling for an annual growth rate of 7 percent in that Lee’s pledge focused on a nominal growth rate.
It said Park’s vision features strengthening the competitiveness of the economy.
Kim, also a professor of Sogang University, stressed that trust building is key to boosting the economy’s growth potential.
“We understand that we could raise one percentage point of growth potential by building trust in the economy and this is one of the tenets of Park’s campaign pledge,” he said.
Under the proposed vision, the Park campaigners called for a public/private partnership to facilitate greater transparency in government operations as well as supporting the growth of the domestic IT industry.
Last week, Rep. Park unveiled the so-called two-track vision calling for achieving economic justice and raising the growth potential. She cited the Organization for Economic Cooperation and Development (OECD) report, which projected that Korea’s potential growth rate will drop to 1 percent in 20 years from now.
Campaign watchers said Park sharpened her economic rhetoric to create her image as a credible and prepared presidential candidate.
She is also eager to steal the show as her two rivals, Rep. Moon Jae-in of the main opposition Democratic United Party and independent Ahn Cheol-soo, dominated media headlines recently following the initial consultative talks they had in laying the grounds for a unified candidate in the opposition camp, they said.
Regarding Park’s effort to turn the tide with the new buzzwords, some insiders remained skeptical.
They said the term of potential growth is simply too vague.
“I am not sure if it is fair to suggest lifting a potential growth rate amid mounting anxiety about the economy both at home and abroad. It looks more realistic to suggest raising the real growth rate with economic stimulus programs,” a ruling party official said asking for anonymity.