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President Park Calls for Bold Regulatory Reform

President Park Geun-hye has called for aggressive regulation reform to dramatically improve the corporate investment environment.

At the second trade-investment promotion meeting last week, Park emphasized that investment is core to job creation, adding that the Korean government needs to promote bold regulation reform to enhance the investment environment.

She also stressed that regulations should be lifted in a sweeping or “negative” way as much as possible. Lifting regulations in a negative way refers to lifting all, except for core, regulations.

Park noted that the number of regulations increased from 11,000 in 2009 to 14,000 in 2012. She said that a regulatory impact analysis by the Office for Government Policy Coordination and deliberations by the Regulatory Reform Committee should be reinforced to manage regulations and their total number.

President Park also said that local governments should act to facilitate investment. Local governments are responsible for sites where companies have difficulties and environment-related regulations. She requested that the central government cooperate with local governments to promote local projects and improve regulations and to give incentives to local governments that have shown outstanding performance.

The Korean government needs to check whether regulations are obstacles to investment promotion, said Park. The central and local governments and all political parties should collaborate to improve regulations and the investment environment. Regulations should also be checked continuously so that they reflect the actual investment environment.

The president also noted that various efforts have been made to stimulate the Korean economy in the first half of this year. However, many Korean citizens are not benefitting from them, as unemployment has increased and household income growth has slowed. She emphasized that the economic focus should be on recovering public sentiment in the second half of this year.

Regarding the global economy, Park analyzed that Korean exports are likely to face difficulties in the second half of this year as the United States has scaled back on quantitative easing and the Chinese economy has slowed down.

However she added that challenges can be opportunities. Korea can be the largest beneficiary of this challenge, as the United States’ reduced quantitative easing will serve as a positive signal for Korea and as the Chinese economy will certainly continue to grow.

Park mentioned that companies are important companions to the Korean government. Korea is facing a difficult situation, however, companies need to move a step forward to invest so that they can have competitive advantages, said Park.

She noted that good investors invest when times are difficult. Park requested that companies keep their investment plans of KRW 149 trillion this year to make actual investments.

The president said the Korean government will listen to companies and keep its promises, adding that the trade-investment promotion meeting will serve as a communication channel between the government and companies.

Source Text

Source: Yonhap News (July 11, 2013)

** This article was translated from the Korean.

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