17th Ministerial Meeting on Boosting the Economy
16th Ministerial Meeting on the Economy of 2019
Government to Promote Consumer Goods Export
Deputy Prime Minister Hong Nam-ki presided over the 17th Ministerial Meeting on Boosting the Economy, that is, the 16th Ministerial Meeting on the Economy of this year, held on June 12. Plans to promote consumer goods export and how to pursue the platform economy are main topics of discussion, service sector development proposals being reviewed. At the beginning of the meeting, DPM Hong talked about the May job data released just before the meeting. He also called for the passage of the supplementary budget by the National Assembly as soon as possible.
The following is a summary of DPM Hong’s keynote address.
May job data
A total of 259,000 jobs were added to the economy in May according to the data released this morning, this year’s average until May exceeding the target of 150,000 and the average of the latest four months standing at 236,000. It is a good sign that the employment rate improved along with the labor force participation rate. Youth job data improved, both the employment rate and unemployment rate getting better, and jobs among those aged 15-29 have risen for nine months in a row.
Services led job growth as employment in hotels & restaurants rose for the fourth consecutive month in May. Jobs in wholesale & retail improved slightly after a slowdown for 17 months. However, employment continued to decline in the manufacturing sector and among those in their 30s and 40s. The government will renew its efforts to boost the economy to help job creation in the private sector. The second half economic policies, scheduled to be announced this month, will contain a number of plans to boost the economy, including 10 trillion won worth of investment projects and regulatory reforms.
Promote consumer goods exports
The current account is expected to return to a surplus in May after posting a deficit of US $660 million in the previous month due to temporary factors, such as large amount of dividends paid to foreign shareholders. Surpluses of a total of US $60 billion are expected over this year. To support the country’s exports amid increasing global economic uncertainties, including trade tensions between the US and China, the government has been working closely with related bodies. Korea signed a post Brexit free trade deal with the UK on June 10.
The government will support exports through plans to promote consumer goods exports, according to which Korea’s consumer goods exports are going to reach US $35 billion by 2022, an increase from US $22.7 billion in 2018. To this end, the government will
- Raise its export finance support from 4.8 trillion won of last year to 8.0 trillion won this year, focusing on the five consumer goods industries, such as food, cosmetics, pharmaceuticals, clothing and other daily necessities
- Choose 15 most promising consumer goods brands and help them grow into “K-premium Brand”, as well as grow local handmade manufacturers by setting up urban manufacturing sites
- Run a program to help exporters with getting export certificates and going through customs clearance procedures
Continue to work on the platform economy
The government announced its first round of plans to develop platform economies, such as data analytics and AI (December 26, 2018), and a hydrogen economy (January 17, 2019), along with its plans to develop workforce required (January 16, 2019). The second round of measures has been drawn up with its focus on promoting industrial convergence and building up a virtuous cycle in which platform economies boost other industries and vice versa.
- Work on model cases of industrial convergence between a platform economy and other businesses, paying attention to how it changes existing industries, brings about new industries and improves our living quality
- Build up a data transaction system and find ways to grow quality workforce
Work on service sector development
The government has been working for five months on measures to develop the service sector. We have put the first priority on removing discrimination against services in comparison with manufacturing, getting rid of regulatory obstacles and increasing R&D investment. We will review the proposals today and work to announce the measures by the end of this month.
Please refer to the attached pdf