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'Overcoming crisis, inclusive growth will define 2021'
Deputy Prime Minister and Finance Minister Hong Nam-ki speaks during a meeting with senior officials at the Sejong Government Complex, Monday.
By Lee Kyung-min
Finance minister promises real estate market stabilization
By Lee Kyung-min
The COVID-19 pandemic should be weathered through bolstering consumption, investment, exports and job creation ― key objectives that must be pursued and underpinned by thorough containment of the disease, Deputy Prime Minister and Finance Minister Hong Nam-ki said Monday.
Greater emphasis will be placed on stabilizing the real estate market, he reiterated, but whether the years-long failed policies for this will yield a tangible result remains to be seen since two-dozen botched measures led to an almost 60 percent rise in apartment prices in Seoul over the past three years.
Also to be monitored is whether the plight of “jeonse” tenants increasingly being forced out of their current places of residence without a new place to go, an inevitable result as home owners demand higher jeonse deposits to offset the higher taxes imposed by the government to stem property speculation, will be addressed adequately. Unique to Korea, jeonse is a home renting system whereby tenants pay a lump sum refundable deposit instead of monthly rent.
“The government, the Ministry of Economy and Finance in particular, should work harder to help the country grow 3.2 percent and create 150,000 jobs this year, through a quick and strong v-shaped recovery,” Hong said during a meeting with senior officials at the Sejong Government Complex.
All possible resources should be allocated to help reduce regulatory hurdles, the ground-laying work needed to attract greater private investment and foster firms with online-centered and contactless business models, he added.
The pandemic-driven economic crisis should not cause permanent damage to the country's growth potential, one reason he said the government's new policy initiatives should play a central role to identify future-oriented sustainable growth engines and boost productivity in the process.
They include a low-carbon drive, as part of the Green New Deal, a key pillar underpinning the “Korean New Deal,” alongside strengthening the social safety net. Growth with “innovative initiatives” will be led by greater government assistance including subsidies and grants for venture firms and new market players with advanced technologies yet high potential for creating a paradigm shift in cut-throat competition.
The growth-oriented policies should be equally prioritized with risk management, without which all objectives can and will be undercut, derailing the country from its projected course of recovery, he noted.
“Real estate policies, household debt and population policies will be monitored more closely for underlying risk factors that could develop into a full-fledged crisis, which should be avoided at all costs. With all our efforts, we will be able to weather what could be the defining moment of the economy.”