Suchergebnisse

The election for the 21st National Assembly of Korea, the country's unicameral legislature, was scheduled on April 15. In late March, the National Election Commission (NEC hereinafter), the government body governing electoral administration, announced its plan for preventing COVID-19 infection during elections. Voters were obligated to wear a mask when coming to vote and, while waiting to enter a polling station, waited at pointed spots separated at least 1 meter from each other. When entering the polling station, voters had their temperature checked by non-contact thermometers, sterilized their hands and put on sanitary gloves. Special procedures, such as distance voting, and separate polling booths were prepared for those already confirmed to be infected or showing symptoms.

The city of Gwangju and Hyundai Motors finally signed an agreement on January 31 on the much-anticipated Gwangju job project. Known as being motivated by the Auto 5000 model introduced at Volkswagen (VW) during 2001-2008, the project's objective is to create a joint venture between the city government and the carmaker. Beginning in 2021, the venture will produce new models of small sport-utility vehicles (SUVs) in an industrial complex in Gwangju. The city government will become the largest shareholder (21%), followed by Hyundai Motors (19%). The latter will also develop the new models to be produced and provide the necessary technological support from plant construction, operation, production and quality control to sales. If the project is implemented successfully, the Gwangju plant will be the first new automobile plant producing Hyundai cars in Korea in more than two decades, with a capacity of 100 thousand cars per annum. The final hurdle to the agreement was the carmaker's demand to fix the terms of employment until the accumulated production reaches 350 thousand cars. This was demanded in the name of providing stability and reducing uncertainty in the project's earliest phase, while the Federation of Korean Trade Unions (FKTU), the labor-side partner of the city government, saw it as a threat to basic labor rights. The agreement collapsed last December over this clause, but the FKTU accepted it this time, with its concerns reflected in the form of an annex.

Employment is currently the hottest topic in Korea. Changes in monthly employment from the previous year show a downward trend since the Moon administration took office in May 2017. This resulted in a rising trend in unemployment rate during the same period, with the latest data (for April 2019) recording 4.4%, a 0.2 percentage point rise compared to the month before President Moon's inauguration. Critiques see this as evidence that the government's strategy of income led growth is backfiring. They claim that the line of policies for income led growth, particularly the rapid increase of minimum wage, are to blame for the sluggish employment and rising unemployment. Whether the income led growth strategy backfired and caused the sluggish employment is a question that requires careful counterfactual analysis. Looking at sectoral employment, however, the data suggests that the overall employment would have been much worse without the expansion in the public and social services sector which is also a part of the income led growth strategy. Employment in public and social services has been rapidly rising in the current government, from less than 4.9 million in May 2017 to more than 5.1 million in April 2019, while the other sectors combined showed a slightly declining trend during the same period. The Moon administration's goal is to create 340 thousand jobs in public and social services during its mandate, to improve the scope, quantity and quality of these services.

The Brexit negotiators agreed to have a transition period starting from the beginning of the UK's withdrawal from the Union to the end of 2020. During this period the UK will mostly remain in the current EU system as if it were a member, with the exception of the Union's decision-making process. It was clear from the outset of the negotiations that the time left until the UK's departure from the Union, expected to be in March 2019, would be insufficient to conclude and put into effect a proper framework to govern the post-Brexit relationship between the EU and the UK. Both parties wanted to avoid an abrupt change, and to reduce the uncertainty stemming from this negative prospect, because of the importance of their bilateral relationship. Although the UK wished for a transition period lasting for 2 years, it will end at the same time with the UK's contribution to the Union's Multiannual Financial Framework, which is seen as more logical.

Despite the unanimous warnings of professional economists, the UK voters voted to leave the EU. The Brexit decision was followed by the election of Donald Trump on the other side of the Atlantic, the advancement of the populist PVV in the general election in the Netherlands (in a smaller scale than expected, though), and is likely to be followed by similar successes in Germany (AfD) and in (the first round, at least, in) France (FN). This sequence of electoral success of populism raises concern, because of the common attitude of its practitioners against trade liberalization and immigration which, according to economic research, are beneficial for all countries involved. On top of proving trade and migration to be beneficial, economics research has also got something to tell about the causes and consequences of the rise of populism. I list below a few such studies and draw policy implications (with no intention to provide a comprehensive literature review).

This report reviews what the Moon Jae-in administration's income-led growth has achieved and has not, as of the end of 2019. Similar concepts to income-led growth, such as inclusive growth, are getting more attention among the academic and policy circles internationally these days. The Korean government's income-led growth, which aims at supporting household disposable income and expanding social safety nets, can contribute to this trend.