Following his nomination by President Moon Jae-in on Sunday as deputy prime minister for the economy and finance minister, Kim Dong-yeon said his main objectives will be to revitalize the country’s lagging economy by increasing the effective tax rate and adding more jobs.

“I think the next five years will be our last chance to save the economy,” Kim said during a press conference at the Government Complex in Gwacheon on Sunday.

“In the short term, we will concentrate on internal and external crisis management and will do our best to create people-centered jobs as well as income-centered growth to revitalize our economy,” he added. “In the medium term, we will focus on improving the structure of our economy.” 

The appointment of Kim, a former veteran bureaucrat and incumbent Ajou University president, comes amid Korea’s lackluster economic growth, which has reported less than 3 percent growth from 2012 to 2016, with the exception of 2014, which reported growth of 3.3 percent.

Furthermore, despite the number of employed individuals in Korea increasing last month, the nation’s unemployment rate hit a 17-year high in April, according to data compiled by Statistics Korea.

The number of jobless individuals reached roughly 1.17 million last month, up 99,000, marking the highest unemployment rate for the month of April and the highest after February’s 1.35 million.

Kim also said the government plans to revisit issues of tax reduction and the exemption system, and intends to increase the effective tax rate.

“I will look into the tax reduction and redemption benefits first, and then I will try to increase the effective tax rate in terms of comprehensive taxation or separate taxation,” Kim said.

“With fiscal policy, the government can contribute to increasing aggregate demand. However, if the policy is wrong or somehow distorted, it will not be able to achieve its intended goal,” the finance minister nominee said. “While fiscal policy should play an active role in the economy, it must be robust in order to foster sound fiscal measures, economic vitality and potential growth.”

According to Moon on Sunday, Kim was also tapped as head of the Finance Ministry with the confidence that Kim will be able to develop measures to tackle many of the country’s societal challenges including the rapidly aging population and declining birth rate. 

By Julie Jackson(juliejackson@heraldcorp.com)