July 29, 2021

The South Korean government replaces the finance minister before the economic slump

The South Korean government replaces the finance minister before the economic slump



The South Korean president, Moon Jae-in, announced today the replacements of the minister of Finances and his main economic adviser before the bad march of the economy in the Asian country and the internal disagreements on the formulas to correct the situation.

Moon appointed Hong Nam-ki as head of finance, considered a technocrat who until now had worked as head of political coordination for the prime minister, replacing Kim Dong-yeon, as detailed by the presidential office in a statement.

In turn, Moon has also dismissed Jang Ha-sung, head of the cabinet for economic policy, and has appointed in his place the one who until today had been his secretary of social affairs, Kim Soo-hyun.

Jang is considered the architect of the growth policy based on the increase in average income in order to boost consumption and reduce the great inequalities of the country, a formula that Moon championed since his arrival at the Blue House in May last year.

This policy has brought with it very controversial measures among South Koreans, such as the increase of the minimum wage by 16 and 11% in 2017 and 2018, respectively.

The measure has hit the service sector or the manufacturing industry severely and has almost completely stopped job creation since the summer.

Members of the current government have publicly shown their disagreement with Jang at the time of giving continuity to this policy, which is wearing down the popularity of the president, whose approval rate in the surveys has been falling for more than a month and goes by 55%.

Added to these factors is a slowdown in Asia's fourth economy – whose growth forecasts for this year have been cut by two tenths to 2.7% – in recent months due to the effects of the trade crisis between China and China. USA, the two main trading partners of South Korea.

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