July 2, 2006
Veteran adviser tipped as S.Korean finance minister
By Yoo Choonsik
SEOUL (Reuters) - A veteran presidential aide with
international experience is set to become South Korea's finance
minister in a cabinet reshuffle on Monday, according to local
media reports, citing sources at the presidential office.
Kwon O-kyu, 54, has served as a policy secretary to three
of the nine presidents in the country's modern history,
including current President Roh Moo-hyun.
News of Finance Minister Han Duck-soo's resignation came
after financial markets closed on Friday.
Education Minister Kim Jin-pyo and Budget Minister Byeon
Yang-kyoon resigned with Han, and Roh plans to name their
replacements on Monday, an official at the presidential Blue
House said late on Saturday.
Some analysts said Kwon would have little problem in
asserting himself at the finance ministry because he has been
within the government for a long time but that he would
probably not alter policy much.
"It may be too short for him to initiate new policies as
the president now has limited time in office," said Lee
Sang-jae, an economist at Hyundai Securities.
South Koreans will elect Roh's successor in December next
Kwon has spent about 25 years in the finance ministry and
in the presidential office, including a few years at the World
Bank, the International Monetary Fund and the Organization for
Economic Co-operation and Development.
His appointment could show Roh's determination to secure a
free trade agreement with the United States since Kwon has much
experience in drawing up policies on foreign trade and
international economic relations.
Roh had been expected to change his cabinet after his
ruling left-of-centre Uri Party suffered a stinging defeat in
local elections on May 31.
South Korea's economy is showing steady growth but faces
risks from rising global interest rates, higher oil and
commodity prices and a sluggish domestic labor market.
Exports to the United States, South Korea's second-largest
market, have been falling in recent years due to competition
from China and an appreciation in the won of some 25 percent
against the dollar over the past 2- years.
Exports are an important engine of growth in the economy,
especially as a recovery in domestic demand from a two-year
slump remains fragile.
The central bank chief said last week that economic growth
might undershoot a forecast of 5 percent this year because of
the won's appreciation and high oil prices.