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(LEAD) Venture minister nominee grilled over past remarks, job credentials

All Headlines 16:49 November 10, 2017

(ATTN: ADDS more info in paras 12-14)

SEOUL, Nov. 10 (Yonhap) -- The venture minister nominee pledged Friday to remove onerous regulations, protect small firms from technology extortion and turn them into growth dynamos, but attacks on his past controversial remarks and wealth inheritance eclipsed his policy vision.

During a parliamentary confirmation hearing, Hong Jong-haak, a former economics professor and lawmaker, was grilled over his ethical and professional qualifications, which opposition lawmakers said are insufficient for leading the newly minted Ministry of SMEs and Startups.

The ruling Democratic Party pleaded for bipartisan cooperation in approving President Moon Jae-in's last Cabinet nominee, dismissing a flurry of accusations against him as "prejudice and misconceptions."

Hong's appointment does not require parliamentary approval, but disapproval could impose a political burden on the president and the nominee.

Opposition lawmakers zeroed in on his family's inheritance of property from his mother-in-law, which may not be illegal but contradicts his long-held position against large transfers of wealth among relatives.

Hong has reported to the government that his family had a total of 4.95 billion won (US$43.7 million) in assets in 2016, up from 2.17 billion won in 2012. These assets include those his teenage daughter inherited from her grandmother in 2015.

Critics have raised suspicions that Hong's wife and daughter might have split his mother-in-law's property in order to pay less gift tax, in a scheme likely to unnerve faithful taxpayers.

Hong showed signs of regret, saying he still believes that "excessive" transfers of wealth among family members and relatives impede the development of a market economy. But he added that his mother-in-law made all the decisions on the inheritance and that he couldn't reject them.

"I have been humbly reflecting on this," he said. "I have been enthusiastically working to address structural problems in our society, but I think I have damaged (the feelings of) many people."

Venture minister nominee Hong Jong-haak speaks during a parliamentary confirmation hearing at the National Assembly in Seoul on Nov. 10, 2017. (Yonhap)

Hong was also denounced for comments in his 1998 book that painted those who did not graduate from top-tier universities as people "without fundamental knowledge." He apologized for it.

"Whatever the process (of including the comments in the book) was, I would like to take this opportunity to say I am sorry to those who might have been offended by anything I wrote that was incorrect," he said.

In response to a lawmaker's question over his past criticism of family-run conglomerates, or "chaebol" as they referred to in Korean, Hong said he does not have any "lopsided" views against them.

In his academic papers published in the early 2000s, Hong referred to chaebol as "cancer cells," arguing their relentless business expansion has driven small firms into insolvency

"I will take more caution in light of what you have pointed out," he said.

Despite criticism coming thick and fast, Hong said he had no intention of giving up the nomination for the ministerial post.

"I have lived my entire life for small enterprises, small merchants and the self-employed, and I believe I have to contribute to supporting them," he said. "I will try hard to address the suspicion surrounding me and gain your trust."

The ruling party came to the defense of the nominee, insisting he is "well-suited" for the post.

"Experts say that what his family did in the process of wealth transfers did not run afoul of any law," Woo Won-shik, the party's floor leader, said, highlighting his past role as a civil activist and lawmaker who advocated for fairness and transparency in the country's economy.

During his opening remarks at the hearing, Hong reiterated his commitment to preventing larger firms from stealing small subcontractors' technologies under unfair deals and to allaying concerns about the potential impact of Moon's policy plans, such as raising the minimum wage.

"There have been numerous policies and government spending (announcements), but SMEs, startups and small merchants are still going through difficulties," he said. "We are in dire need of real outcomes, and I would like to play a role in meeting that need."


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