ID :
41484
Mon, 01/19/2009 - 14:54
Auther :
Shortlink :
https://oananews.org//node/41484
The shortlink copeid
(News Focus) Finance minister-designate to tackle biggest economic crisis in decade:
SEOUL, Jan. 19 (Yonhap) -- South Korea's incoming finance minister should double
up efforts to stabilize financial markets and bolster an economy poised to slip
into its first recession in more than a decade, analysts said Monday.
Yoon Jeung-hyun, 62, was appointed to the post by the president, replacing the
embattled Kang Man-soo, who had been under pressure to resign for what critics
have called his "misguided" economic and financial measures. The replacement
comes less than a year after Kang's inauguration.
"Yoon is well versed in financial affairs with expertise in overall economic
issues and we expect him to gain the market trust needed to get over the current
economic crisis," Lee Dong-kwan, a spokesman for the presidential office, told a
press briefing.
The former head of the financial watchdog said he would "do my best" to tide over
the economic crisis, calling for cooperation among all government agencies to
achieve that goal.
Yoon will assume the nation's top economic policymaking post at a time when the
nation is fast slipping into the first recession since the 1997-98 financial
meltdown, hit by slumping exports and weakened domestic demand.
The job market also remained stagnant, making things worse for the government
which is striving to bolster domestic demand with a raft of stimulus measures
including tax cuts and fiscal spending.
Last month, the economy saw the first job contraction in more than five years as
companies scaled back recruitment for fear of worsening economic conditions.
Industrial output slumped by the sharpest ever in November since the nation
compiled related data in 1970.
Many investment banks and research institutes lowered their 2009 growth
projections for Asia's fourth-largest economy to the 1-percent range. Some
painted bleaker pictures, projecting the first recession in a decade.
Analysts expect no drastic change in the government's economic polices with
Yoon's appointment, saying the new finance minister's top priority should be
placed on brining stability and trust back to the markets.
"With little changes expected in the government's economic policy line, the new
economic team must put more focus, among other things, on stabilizing the markets
and reinvigorating the economy," said Ko Yu-sun, an analyst at Daewoo Securities.
Kang, President Lee Myung-bak's first choice to head the economic team, had drawn
criticism for his alleged "weak" local currency policy aimed at boosting exports
and the broader economy.
The pro-growth policy hit a snag as a sharply-sliding won drove up import costs
of already-soaring oil and commodity prices, sending the nation's inflation to a
10-year high in July.
Despite somewhat eased inflationary pressure, he also faced an unexpected
collapse of global investment bank Lehman Brothers in September, which sent world
financial markets into a tailspin.
The stock market tumbled nearly 40 percent last year, while the local currency
lost 25 percent against the greenback, becoming one of the worst-performing
currencies in Asia.
The financial turbulence turned President Lee's pro-growth pledge into a long
shot. Under the pledge, the president promised to achieve annual economic growth
of 7 percent, double the nation's per-capita income to $40,000 over a decade and
eventually place Korea among the world's top seven economies.
"The first economic team led by Kang didn't cope well with a dramatic change,
sending mixed signals to the market and losing market trust by swinging back and
forth in its focus on crisis management and growth," said Kim Sang-jo, head of
the Solidarity for Economic Justice, a civic group representing minority
shareholders.
One clear achievement Kang made during his short tenure was to bring some
composure into the wobbling financial markets by dramatically clinching a $30
billion currency swap pipeline with the United States in late October.
Still, analysts worry that markets could go into a panic at any time as local
banks and companies are still suffering from a credit crunch and economic
indicators are pointing to bleaker conditions down the road.
They say that the government has to provide a clear direction for corporate
restructuring and any hesitation could exasperate the current money crunch and
fail to regain market trust for its economic policies.
kokobj@yna.co.kr
(END)
up efforts to stabilize financial markets and bolster an economy poised to slip
into its first recession in more than a decade, analysts said Monday.
Yoon Jeung-hyun, 62, was appointed to the post by the president, replacing the
embattled Kang Man-soo, who had been under pressure to resign for what critics
have called his "misguided" economic and financial measures. The replacement
comes less than a year after Kang's inauguration.
"Yoon is well versed in financial affairs with expertise in overall economic
issues and we expect him to gain the market trust needed to get over the current
economic crisis," Lee Dong-kwan, a spokesman for the presidential office, told a
press briefing.
The former head of the financial watchdog said he would "do my best" to tide over
the economic crisis, calling for cooperation among all government agencies to
achieve that goal.
Yoon will assume the nation's top economic policymaking post at a time when the
nation is fast slipping into the first recession since the 1997-98 financial
meltdown, hit by slumping exports and weakened domestic demand.
The job market also remained stagnant, making things worse for the government
which is striving to bolster domestic demand with a raft of stimulus measures
including tax cuts and fiscal spending.
Last month, the economy saw the first job contraction in more than five years as
companies scaled back recruitment for fear of worsening economic conditions.
Industrial output slumped by the sharpest ever in November since the nation
compiled related data in 1970.
Many investment banks and research institutes lowered their 2009 growth
projections for Asia's fourth-largest economy to the 1-percent range. Some
painted bleaker pictures, projecting the first recession in a decade.
Analysts expect no drastic change in the government's economic polices with
Yoon's appointment, saying the new finance minister's top priority should be
placed on brining stability and trust back to the markets.
"With little changes expected in the government's economic policy line, the new
economic team must put more focus, among other things, on stabilizing the markets
and reinvigorating the economy," said Ko Yu-sun, an analyst at Daewoo Securities.
Kang, President Lee Myung-bak's first choice to head the economic team, had drawn
criticism for his alleged "weak" local currency policy aimed at boosting exports
and the broader economy.
The pro-growth policy hit a snag as a sharply-sliding won drove up import costs
of already-soaring oil and commodity prices, sending the nation's inflation to a
10-year high in July.
Despite somewhat eased inflationary pressure, he also faced an unexpected
collapse of global investment bank Lehman Brothers in September, which sent world
financial markets into a tailspin.
The stock market tumbled nearly 40 percent last year, while the local currency
lost 25 percent against the greenback, becoming one of the worst-performing
currencies in Asia.
The financial turbulence turned President Lee's pro-growth pledge into a long
shot. Under the pledge, the president promised to achieve annual economic growth
of 7 percent, double the nation's per-capita income to $40,000 over a decade and
eventually place Korea among the world's top seven economies.
"The first economic team led by Kang didn't cope well with a dramatic change,
sending mixed signals to the market and losing market trust by swinging back and
forth in its focus on crisis management and growth," said Kim Sang-jo, head of
the Solidarity for Economic Justice, a civic group representing minority
shareholders.
One clear achievement Kang made during his short tenure was to bring some
composure into the wobbling financial markets by dramatically clinching a $30
billion currency swap pipeline with the United States in late October.
Still, analysts worry that markets could go into a panic at any time as local
banks and companies are still suffering from a credit crunch and economic
indicators are pointing to bleaker conditions down the road.
They say that the government has to provide a clear direction for corporate
restructuring and any hesitation could exasperate the current money crunch and
fail to regain market trust for its economic policies.
kokobj@yna.co.kr
(END)
