Spring, when everything comes alive again, has arrived. Soft winds are blowing, warm weather has returned with increased sunlight, cherry blossoms are in full bloom and other flowers have started appearing.
However, the season has not brought much cheer, as it is accompanied by wholly gloomy and disappointing news.
North Korea is ratcheting up military tension on the Korean Peninsula with nuclear threats, and more and more cases of child abuse – including by parents — are being uncovered.
On economic front, the indices are not very healthy. The youth jobless rate skyrocketed to a record high of 12.5 percent in February. The national debt surpassed $500 billion ($432 million) for the first time, and household debt, dubbed a “ticking time bomb,” reached nearly $1 trillion last year.
On top of these, the trend of weak domestic demand and a downturn in exports is continuing, and a recent government report forecast that senior citizens will exceed 40 percent of the South Korean population by 2060 added to the nation’s anxiety.
To make matters worse, our nation’s economic outlook for this year is increasingly pessimistic. Major economic institutes and foreign investment banks are lowering their growth projections to less than 2.7 percent, unlike the Bank of Korea’s 3 percent and the Finance Ministry’s 3.1 percent.
If exports are revitalized and the frontloading of government budget spending has a positive impact, our economy may near its growth target. But chances are that our economy will remain below 3 percent growth as it did in the previous year — recording 2.6 percent amid global economic uncertainties.
For the past five years, Korea has grown less than 3 percent a year, except for 2014, when it grew at 3.3 percent, raising the possibility of the nation being dragged into a low-growth trap.
It is against this backdrop that some economists are calling for the government to take early stimulus measures such as lowering key interest rates to avoid following the footsteps of Japan’s long recession.
At the very time when the nation is facing such crucial economic conditions, general elections to pick 300 members of the unicameral legislative house of the National Assembly will be held next week.
Much to our regret, however, the ruling and opposition parties, key players of the elections, do not appear to be competing with economic policies during their ongoing electioneering.
Instead, they are busy trading blame for the current economic difficulties. Opposition parties are appealing to voters to support them, accusing the ruling camp of having ruined the economy. But the governing party attributes the economic slump to the opposition camp’s stalling of legislative moves to enact a set of economic reform proposals aimed at developing the nation’s service industry and reforming the labor market.
As the election campaign began in earnest last week, the political parties belatedly started to churn out their economic pledges, many of them hurriedly arranged, half-cooked and populism-oriented.
One of the examples concerns the parties’ campaign promise to create more jobs for youth. The ruling party vows 500,000 more jobs mainly through establishment of special business zones exclusively for companies that return to Korea, while the main opposition Minjoo Party of Korea has pledged to create 700,000 jobs by allocating quotas to public and private companies to hire a certain portion of young job seekers. But such pledges are typically a prime model of populism as they are unrealistic and have no concrete action plans such as how to finance them.
As they did in the previous campaign in 2012, a number of pledges parties and their candidates have made before voters are likely to be left unimplemented. According to Citizens’ Coalition for Economic Justice, an independent civic group which reviewed successful candidates’ pledges related to development projects, the rate of implementation was merely 12 percent.
This may indicate that our voters pay little attention to economic issues as far as elections are concerned. Traditionally, economic performance has not played a pivotal role in swaying election outcomes in Korea, except for the presidential election in 1997 that was held amid a financial crisis.
The coming elections to form the 20th National Assembly are unlikely to be much different from previous polls in voting behavior. In the long run, regional favoritism in which voters tend to support candidates from their same region, and voters’ political ideologies will hold sway.
For our better future, political parties and their candidates should come out with well-prepared economic policies and have in-depth debate on economic issues during election campaigns, cutting ties with old-fashioned politics.
By Shin Yong-bae
Shin Yong-bae is the business editor of The Korea Herald. He can be reached at shinyb@heraldcorp.com. — Ed.
