'Korea not follower but now trendsetter'

By Kim Tae-gyu

President Park Geun-hye

President Park Geun-hye presided over a top economic advisory council, Wednesday, reviving an important policymaking body to spur the sagging economy.

Park appointed 30 economic scholars and experts as members of the National Economic Advisory Council (NEAC) where she is the ex officio chairwoman.

“The current economic situation is not that favorable for us as slow growth continues and our growth potential keeps falling. We also have such hitches as a fast aging population and North Korean threats,” Park said.

“To overcome the challenges and achieve an employment rate of 70 percent, I ask you to help transform our economy from a follower to a trendsetter.”

As Park’s deputy, Professor Hyun Jung-taik of Inha University will take charge of managing the council.

Former President Kim Dae-jung initiated the NEAC in 1999 following the Asian financial crisis and it also assumed significant responsibilities under his successor Roh Moo-hyun.

However, President Park’s predecessor Lee Myung-bak created a slew of economic advisory entities so the NEAC became a nominal entity during his five-year stint.

Park scrapped all the economic advisory outfits and plans to beef up the functions of the NEAC whose quarterly meetings also involve five of her senior secretaries and ministerial officials as ex-officio members.

The council painted a gloomy picture for the economy at the initial meeting. It said a commissioned report showed the average annual economic growth rate would plunge to 3.6 percent in the 2010s and 2.7 percent in the 2020s.

“The government must overhaul the public segment and secure fresh growth engines as well as manage the macro economy in stable ways,” it said.

It took issue with the maturity of the existing growth strategy, weak competitiveness of small companies and the fast aging society.

The number of the economically active population aged between 16 and 64 is expected to peak at 37 million in 2016 before plunging.

“The report is an objective evaluation on the Korean economy presented through the collaboration of authoritative think-tanks,” presidential senior economic aide Cho Won-dong said.

The state-run Korea Development Institute, Samsung Economic Research Institute, and Goldman Sachs and McKinsey prepared the report for the council meeting.

Cho said NEAC will play a key role in dealing with economic concerns as the only presidential economic council. It will convene once every three months while gatherings of sub-committees will take place more frequently.

“NEAC is composed of four sub-committees of macro finance, creative economy, economy for ordinary people and fair competition. We appointed the cream of the crop as its members,” Cho said.

Korea’s employment rate has been fluctuated in the vicinity of 65 percent and Park promised to jack this up to 70 percent during her election campaign. The goal is a tough mission, according to experts.

In particular, Park stressed the significance of convergence businesses and brisk support for small- and medium-sized enterprises.