President Park Geun-hye is to preside over a ministerial meeting on regulatory reform March 20. The meetings have thus far been chaired by the prime minister. Yet she decided to host them herself from this point on to demonstrate her resolve to drastically reform the regulatory environment.
Two months ago, Park declared a war on regulations. In her New Year news conference, she sketched out a three-year economic innovation plan, highlighting deregulation as a key strategy.
Since then, the need for sweeping deregulation has become one of her mantras. She has repeatedly urged ministers to pursue deregulation to remove obstacles to business activities and spur corporate investment.
For instance, on Feb. 5, Park urged officials to tackle deregulation with the indefatigable spirit of the Jindo dog, noting that the indigenous Korean breed never lets go after biting an animal.
On Feb. 19, during a joint policy briefing by the land and environment ministries, Park called for an aggressive lifting or relaxation of restrictions on the use of land, saying such regulations impede investment.
On Feb. 25, unveiling the blueprint for the three-year economic plan, Park said the government would introduce a “one-in, one-out” system requiring a government agency to remove an existing regulation in return for introducing a new one.
More recently, Park sounded an even more resolute tone on regulatory reform. On March 10, she described unnecessary regulations as “an enemy that must be crushed” and “a tumor that needs to be removed.”
Two days later, Park exhorted officials to view deregulation as a “make-or-break” task and tackle it with “burning patriotism and resolute determination.”
The escalating tone of her remarks on deregulation suggests her growing frustration with the lack of any tangible outcome when it comes to increases in corporate investment.
So Park has reportedly decided to take matters into her own hands. She was quoted as having told officials to bring her tangled regulations that they were unable to unravel, suggesting that she would try to sort them out herself.
The president’s hands-on approach is desirable, given that government officials have little incentive to get rid of regulations. Regulations are their main source of power. So the more regulations, the better.
Numerous deregulation drives pushed by previous governments all failed just because the tasks were left solely to government officials. To avoid the same mistake, Park needs to ensure that experts from private business organizations, such as the Korea Chamber of Commerce and Industry, are involved in the decision-making process.
At today’s meeting, Park is expected to unveil a roadmap for regulatory reform. Cheong Wa Dae officials say she will announce radical reform programs that will differentiate the incumbent government from previous ones.
One simple, drastic approach may be to put all government regulations to two types of tests. One determines whether a regulation is needed, while the other decides whether the means used to implement it are appropriate. All regulations that fail one of the two tests are to be eliminated.
Whatever deregulation approach the government adopts, it cannot succeed without full cooperation from the main opposition Democratic Party. This is because abolishing or softening regulations in many cases requires revision or enactment of laws.
In this regard, the DP needs to offer full support to Park’s regulatory reform. It is time for Korea to free the economy from excessive regulations. The opposition party should pull its weight in helping the economy make another leap forward.