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Lee seeks investment to help boost economy

South Korean president plans to cut taxes, remove or reform unnecessary regulations

Lee seeks investment to help boost economy

President Lee Myung Bak, South Korea’s first president with a business background, pledged to cut taxes and speed up deregulation to encourage investment and boost economic growth.
“Unnecessary regulations will be either cast away or reformed as early as possible,” Lee said in his inauguration speech in Seoul yesterday. “We must lower taxes as well. Only then will we see investments and consumption increase once again.”
Lee is “obviously hoping that his can-do attitude, deregulation and other measures will bring in investment,” said Kang Chul Kyu, an economics professor at University of Seoul, and a former chief of the Fair Trade Commission.
Lee, nicknamed the “Bulldozer” while running Hyundai Engineering & Construction Co., previously announced a plan to make housing more affordable, his intention to shrink government by merging ministries and a program to improve the English- language skills of South Korean students.
The president is banking on non-government investment to fund housing loans and a 16 trillion won (US$16.8 billion) project to build a “Great Waterway,” a network of canals through South Korea and branching up to the North Korean capital of Pyongyang.
Asia’s fourth-largest economy expanded 4.9 percent in 2007 from a year earlier, and Lee is aiming for growth of about 6 percent this year, higher than forecasts by the Ministry of Finance and the Bank of Korea.
The “Great Waterway,” which would begin with a 20- kilometer (12.4-mile) link between two rivers, will ultimately become a 2,100 kilometer waterway from Busan to Seoul.
Lee says he would extend it another 1,000 kilometers north from the demilitarized zone if North Korea fulfills its pledge on dismantling nuclear weapons.
Lee’s former company, Hyundai Engineering & Construction, is among those that have met to plan the project.
Lee and his Grand National Party also face the challenge of increasing trade with allies and neighbors. He will encourage the National Assembly to ratify a free-trade agreement with the U.S. The deal was signed in June.
The deal, the biggest for the U.S. since the 1994 North American Free Trade Agreement, faces an uphill battle in Congress. Lee probably will discuss it when he visits Washington, probably in April. Trade between the two countries reached US$77 billion last year.
Lee plans to spend about 4 trillion won over the next five years, including hiring 23,000 new English teachers, to make sure all high school graduates are fluent in English.


Updated : 2021-07-31 07:46 GMT+08:00