[NEWS ANALYSIS]New policymakers hoped to restore market trust

President Lee Myung-bak`s reshuffle yesterday of the top economic policy team may not bring a sea change in macroeconomic policies, but the new members should be able to have stronger teamwork, experts said yesterday.

In a reshuffle that focused on economic portfolios, Lee replaced Finance Minister Kang Man-soo with Yoon Jeung-hyun, former head of the Financial Supervisory Commission. Chin Dong-soo, CEO of the state-run Export-Import Bank of Korea, was named to replace Jun Kwang-woo, chairman of the Financial Services Commission.

Yoon Jin-shik, former minister of commerce, industry and energy, was tapped to replace Bahk Byong-won as the senior presidential secretary for economic affairs.

The reshuffle came as many economists have found fault with the Lee administration`s foreign exchange policy that brought about instability in March and April last year.

Critics like Chung Un-chan, former president of Seoul National University, attributed the recent wild fluctuations of the local currency and growing economic uncertainties to lack of economic leadership and lost market trust in government policy.

Now, many are paying attention whether the finance minister-appointee Yoon will be able to win back confidence in the market.

Born in 1946, Yoon majored in law at Seoul National University and started his career in civil service in 1971. He spent most of his career at the Finance Ministry, where he accumulated expertise in taxation and finance.

Cheong Wa Dae officials said Yoon is expected to restore market trust on the strength of "his expertise and insight in finance and economy."

Industry watchers said, however, the replacement of a few economic policymakers would not significantly affect the market.

"The shakeup won`t affect the financial market that much," said Seo Chul-soo, an analyst with Daewoo Securities.

"Kang`s grave mistake was that he implemented the wrong foreign exchange policy in March and April. But the much-heated controversy over the won has abated since the October currency swap deal with the United States."

The won, which plummeted to as low as 1,500 in November, has gained some strength to reach the mid-1,300 level in January.

"Except for the foreign exchange policy controversy, Kang`s macroeconomic policies were carried out relatively well last year," said Oh Suk-tae, an economist with Citigroup.

"The quick increase of the fiscal spending to cope with the economic downturn was timely, in particular."

A positive effect from the economic team`s reshuffle would be better policy coordination between the government and the financial regulator, because Yoon and Chin, the FSC appointee, worked together at the Finance Ministry, experts said.

Chin worked at the ministry from 1994 and became vice finance minister in 2006.

Industry sources said the Finance Ministry and the FSC had some coflicts in economic policies because the current Chairman Jun has no background as a bureaucrat.

Inappropriate and uncoordinated remarks by top economic policymakers often sparked criticisms that they lack the capacity to quickly pull the ailing economy out of a slump.

While Kang said a 3 percent growth will be hard to achieve in 2009, Bahk, the outgoing presidential aide, said a 4 percent growth will be feasible at a forum in December.

By Kim Yoon-mi



(yoonmi@heraldm.com)





[PROFILE]



Yoon Jeung-hyun

Minister of Strategy and Finance



Yoon Jeung-hyun, appointed to head the Finance Ministry, is a well-known administrator and a veteran in finance and taxation.

Yoon was born in 1946 and majored in law at Seoul National University. He received his master`s degree in public policy and administration from the University of Wisconsin-Madison.

He passed the state civil examination in 1971, starting his career as a public servant at the national tax administration and finance bureau at the finance ministry.

He spent most of his career at the ministry, where he accumulated expertise in taxation and finance. He left the ministry after the nation was hit by the Asian financial crisis in 1997.

Yoon served as dean of National Tax College in 1998 and executive director of Asian Development Bank in 1999.

He was appointed as chairman of the Financial Supervisory Committee and governor of the Financial Supervisory Service in 2004 during the Roh Moo-hyun administration. He held the post until 2007.





Chin Dong-soo

Chairman of the Financial Services Commission



Chin, 59, has held key posts in the field of financial and economic policy, since he received a master`s in economics from Boston University back in 1981.

Chin studied law at Seoul National University, he joined the Ministry of Strategy and Finance (then Finance and Economy) in 1977. While working there, he was involved in efforts to improve transparency in the country`s financial system. Chin also led banking reform efforts after the nation`s banks were hit by the Asian financial crisis in 1997.

Since 2006, as Vice-Minister of the Ministry of Finance and Economy, he has coordinated major international affairs issues and economic policy. He also served as Standing Commissioner of the Financial Supervisory Commission and CEO of the Public Procurement Service.

Chin served three years as a World Bank Deputy Director from 2001 and has coordinated the country`s international financial affairs as Vice-Minister of Finance and Economy from May 2006 until he became President of the Export-Import Bank of Korea in July 2008.

Chin has often been cited as a candidate for many top posts at economy-related government agencies, including the Financial Supervisory Service, since the inauguration of President Lee Myung-bak because of his wealth of experience in policymaking.

(danlee@heraldm.com)





Yoon Jin-shik

Senior presidential secretary for economic affairs



Yoon, nominated as the top economic policy aide for President Lee Myung-bak yesterday, is a well-known bureaucrat and one of the president`s close advisors.

Yoon played a key role in Lee`s campaign during the 2007 presidential election. He also advised Lee on industrial and overall economic policies in the presidential transition team. Yoon, a year younger than Lee, has known the president since college. Yoon was born in 1946 and studied business at Korea University.

He also received his master`s degree in economics from the Pennsylvania State University.

Yoon was the first commerce minister during the then Roh Moo-hyun government and led the ministry until the end of 2003.

Before taking his ministerial post, he has worked as commissioner at the Korea Customs Service and vice minister of finance and economy.

Yoon currently heads Korea Investment Holdings Co., one of the nation`s major financial holding companies.





Hyun In-taek

Unification minister



Hyun, 55, is the main architect of President Lee Myung-bak`s conservative North Korea policy "Vision 3000: Denuclearization and Openness."

He is a political science professor at Korea University and a well-known international politics expert. The conservative scholar has committed himself to studying security issues and South Korea-U.S. relations.

He served as President Lee`s top foreign policy advisor during his presidential campaign. He later led the foreign policy team of Lee`s presidential transition committee.

Born in Jeju, Hyun studied international politics in Korea University. He received the doctorate in University of California, Los Angeles. In 1992-1995, he worked as senior research fellow at the Sejong Institute, a think-tank. He became a Korea University professor in 1995.

Hyun has advocated policies that link inter-Korean ties with North Korea`s denuclearization, and maintained principles that the South should address North`s nuclear issue through close international cooperation.

He is said to be well-fitted for advertising the government`s unification policy given his broad ties with expert groups here and abroad.

He is currently a member of policy advisory committees to the Defense Ministry and Unification Ministry.

(davidpooh@heraldm.com)



Kwon Tae-shin

Prime minister`s chief of staff



Kwon, the new chief of the Prime Minister`s Office, is a career bureaucrat and economic expert.

He served as presidential secretary for economic policy, vice finance minister and ambassador to the Paris-based Organization for Economic Cooperation and Development before being appointed administrative secretary for Prime Minister Han Seung-soo in October last year.

Kwon, 60, is expected to strengthen the function of the Prime Minister`s Office in coordinating key policies among ministries.

Born in Yeongcheon, North Gyeongsang Province, Kwon majored in economics at Seoul National University.

(jemmie@heraldm.com)