President Moon Jae-in has sacked Finance Minister and Deputy Prime Minister for Economic Affairs Kim Dong-yeon and Presidential Chief of Staff for Policy Jang Ha-sung.
The two top economic policymakers led the nation’s economy for one year and six months since the inauguration of the incumbent government.
Analysts say Moon decided to replace the two as the performance of the Korean economy has not improved under their stewardship. Furthermore, they could not bridge their differences on the government’s key economic policies.
Kim is replaced by Hong Nam-ki, an economic technocrat who is currently serving as chief of the Office for Government Policy Coordination under the Prime Minister's Office. Previously, Hong was an official of the Ministry of Economy and Finance.
Jang’s successor is Kim Soo-hyun, who is currently Moon’s senior secretary for social affairs. Kim is known to have been leading the government’s failed efforts to curb the recent surge in real estate prices.
The reshuffle of the two top economic policymakers is unlikely to reverse the downturn of the Korean economy as Moon has made it clear that he would stick to the economic strategies his government has been pursuing since its launch.
He recently said the government will continue to pursue “income-led” economic growth, although many analysts point out that this policy has negatively affected job creation, which in turn weakened the economy’s growth momentum.
The outgoing finance minister expressed from time to time the need to adjust policy measures that were introduced to achieve income-led growth, but his views were ignored by Moon’s economic advisers at Cheong Wa Dae, including Jang.
The newly appointed economic policymakers are also unlikely to find ways to stimulate the sluggish corporate investment, which is needed to inject vitality into the sluggish economy.
Noh Hyeong-ouk, Hong's deputy, was named to succeed Hong as chief of the Office for Government Policy Coordination, while Kim Yeon-myung, a social welfare expert and professor at Seoul's Chung-Ang University, was tapped to be the new senior social affairs secretary.