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(EDITORIAL from Korea JoongAng Daily on May 11)

Editorials from Korean Dailies 06:59 May 11, 2020

Moon's real challenges

President Moon Jae-in's address on Sunday marking his third year in office reflected the pride he felt in his government's successful handling of the coronavirus outbreak. In the speech, he used the word "crisis" 15 times and the phrase "a leading economy" eight times. That reflects his determination to overcome the Covid-19-triggered economic crisis — and at the same time build a sense of national confidence.

His speech boiled down to two points: building the Korean economy into a new kind of world leader and pursuing a massive New Deal-type project to create jobs. He wants to achieve those goals by building 5G and data infrastructure, fostering remote medical services, educational and retail services, and advancing artificial intelligence technologies. Because such industries are essential components for the future of the nation even without a Covid-19 crisis, we can hardly dispel the thought that they are just a repeat of what the government has said before.

We have no objection to the Moon administration' ambitious plans to drastically expand unemployment insurance and help people find jobs. The need to reinforce job security for non-salaried workers and mom-and-pop store owners has been already confirmed throughout the Covid-19 pandemic. But the problem is how to find the money needed to strengthen our social safety net.

In this sense, Moon's rosy vision appear to be fuzzy. For instance, what he called a "leading economy" cannot be achieved if the government adheres to its old paradigm of regulation. Unless his government embarks on drastic deregulation, what he said in the speech will most likely end up empty promises. A good example can be found in telemedicine. Despite the affirmed merit of ICT in the government's successful battle against the virus, it stops short of institutionalizing remote medical examination and treatment due to stifling regulations and resistance from stakeholders.

If we cannot overcome such a sharp conflict of interests, achieving a leading economy is nothing but a pipe dream. Moon was confident that Korea can emerge as a safe investment destination thanks to its remarkable performance in the battle against the pandemic. However, a successful battle against Covid-19 alone cannot draw foreign investments. Unless an amical environment for investment is created, the government can hardly expect Korean or foreign companies to invest here.

The same applies to Moon's plan to establish a national unemployment insurance system. Anyone can apply for the insurance even now, but the self-employed or contract workers avoid it because of high insurance fees. A rush to address the problem with tax money will certainly face public resistance. The government must not shrug off the dire fiscal condition in which per capita debt reaches a whopping 16 million won (US$13,000).

No one can quarrel with the president's desire to get over the economic crisis and his confidence that he can do that. But he must refrain from complacency. Despite his remarkably high approval rating, Moon must not ignore the chilly reaction from the public to his economic performance over the last three years. In a recent Gallup Korea poll, only 1 percent of respondents praised Moon's economic leadership. Instead of blindly bragging about a successful battle against Covid-19, Moon must learn from French President Emmanuel Macron, who pressed ahead with his socialist reform agenda in the face of strong opposition from supporters and even sustained protests in the streets of France, down to the small towns. Moon's real challenges have just begun.
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