Korea's three-year plan for economic innovation was named as one of the best structural reform proposals submitted by G20 countries.
According to the IMF and OECD's estimate on Nov. 16, the successful implementation of economic growth proposals submitted by member countries at this year's G20 summit will bring about US$85 trillion in their total GDP in 2018, up US$2 trillion compared to the current trend. Each proposal was reviewed for its implications for potential growth rates and assessed by the IMF's own macroeconomic model.
In particular, Korea, which submitted its three-year plan for economic innovation as a plan for structural reform and economic growth, will see its GDP reach 1.437 quadrillion won (US$1.313 trillion), an increase of 60 trillion won (US$54.8 billion) from the current estimate, if the plan is successfully carried out.
A representative of the Blue House and the Ministry of Strategy and Finance said, “The IMF and OECD said that Korea's three-year plan for economic innovation is the best proposal among G20 countries. Our plan was recognized as a model for structural reform.”
The government's three-year plan is concerned with investment, employment, trade, and competition, and is composed of measures to innovate public institutions, three packages to increase household income, and expansive monetary policy. Specifically, the plan suggests building an innovative center for the creative economy, establishing a system to regulate and innovate the economy, revitalizing online shopping and direct purchases in overseas websites, easing entry barriers to the service industry, improving the bad practices of small, medium, and large companies, and tightening up the conditions required to penetrate the local market by foreign educational institutions. However, some point out that the plan is too rosy.
The U.S. proposal deals with many difficult issues, including the finalization of the Trans-Pacific Partnership (TPP) and immigration reform. Japan's plan tackles public sector pensions and the labor force participation rate. E.U. member states, which are suffering from worsening deficits, also laid out measures to expand infrastructure and the European social fund, and to decrease the unemployment rate. Apparently, it won't be easy for member states to execute these tasks as planned in less than four years. Hence, there is criticism that those plans could end up being mere slogans.
What is interesting is Australia's growth strategies. One of Australia's strategies is to finish a free-trade deal with Korea and Japan. The Korea-Australia Free Trade Agreement (KAFTA) was introduced for discussion in the National Assembly to be ratified.