S. Korea's Moon sacks fi­nance min­is­ter, pol­icy chief

Manila Bulletin - - World News -

SEOUL (AFP) - South Korean Pres­i­dent Moon Jae-in sacked his top two eco­nomic of­fi­cials Fri­day, the gov­ern­ment said, as the world's 11th-largest econ­omy strug­gles with slow­ing growth, ris­ing un­em­ploy­ment and per­sis­tent in­come gaps.

Fi­nance min­is­ter Kim Dong-yeon and pres­i­den­tial chief of staff for pol­icy Jang Ha-sung had both been re­placed, top Blue House spokesman Yoon Young-chan said in a tele­vised state­ment.

The pair had re­port­edly been at odds with each other over how to ad­dress the sit­u­a­tion.

Moon's global pro­file has been dom­i­nated by his role in the rapid diplo­matic rap­proche­ment with nu­clear-armed North Korea but at home his han­dling of the econ­omy has be­come in­creas­ingly con­tro­ver­sial, con­tribut­ing to fall­ing poll rat­ings.

His ad­min­is­tra­tion has steeply raised South Korea's min­i­mum wages, cut work­ing hours and con­verted tem­po­rary staff to per­ma­nent in a se­ries of re­dis­tribu­tive moves it says will lead to what it calls ''in­come-led growth''.

It is a marked change from the growth model of the past, driven by ex­ports and in­vest­ments by the South's ma­jor com­pa­nies, that has seen the South rise to be­come Asia's fourth-big­gest econ­omy.

And crit­ics say the moves have had the op­po­site ef­fect to what was in­tended, wors­en­ing the sit­u­a­tion of many low-in­come earn­ers and see­ing small busi­nesses cut staff, while big firms hold back in­vest­ment in the face of tougher reg­u­la­tion.

Last month, the cen­tral Bank of Korea cut its growth fore­cast for this year to 2.7 per­cent, down from the 3.1 per­cent achieved in 2017.

And un­em­ploy­ment jumped 0.4 per­cent­age points to 3.8 per­cent in the third quar­ter, with youth job­less­ness at its high­est since 1999 at 9.4 per­cent.

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