Blue House spokesman Lee Dongkwan stated: "The core message emphasized in the presidential briefing is the importance of public officials' awareness of being a spearhead in the financial crisis. This means that the solution is every public official's responsibility. The newly requested discussion meeting with President Lee, therefore, was all about speed and effectiveness in briefing. This is where the idea of an omnibus-type of reporting was tried. Ministries were divided into macro-economic and economic sections, and two or three of them together made joint reports.
President Lee stated: "In order to pursue our goal as a nation and reduce the waste of government budget, the ministries should cooperate." Throughout the briefing, President Lee was in search of suggestions and solutions to make things better. The oral presentation time of the ministers was reduced to 15 minutes, while the lower officials' chances to add remarks were increased.
Crisis, Cooperation, Efficiency, Jobs
During the entire briefing, the words most often repeated by the president were crisis, cooperation, efficiency and job. Lee stressed that the first step to overcoming the economic crisis involves the collaboration of 22 ministries and government offices.
Amid the prediction that stagnation of the real economy will worsen in the new year, the government and private sector will cooperate to start a Digital New Deal.
While reporting to the presidential office on December 26 and 27, government institutions such as the Ministry of Knowledge and Economy; the Korea Communications Commission (KCC); the Ministry of Education, Science and Technology; the Ministry of Culture, Sports and Tourism; and the Small and Medium Business Administration revealed that they plan to generate domestic demand by activating investments in the digital industry putting IT, software, broadcasting and communications and content together to cultivate them as strategic export industries. The digital industry, which was the key player in pulling the country out of the IMF crisis in the late 1990s, has become a relief pitcher called upon to rescue Korea once again.
KCC and the communications industry have decided to increase the size of investments in networks, gap fillers and content up to 6.88 trillion won this year, from 6.64 trillion won last year. They will directly help related small and medium companies overcome the liquidity problems and activate the economy by raising the execution rate of investment of the first half of the year from around 40 percent of the yearly investment to 56.1 percent. This means that they will attract new investments by using policy means in connection with next generation networks and frequencies.
Shin Yong-seop, Director of the KCC, said: "The nation will face a rough economy until June and telecommunication operators are encouraged to invest more than 6.64 trillion won from 2008 and execute the money during the first half of the year. I will be watching their performance closely," he assured, adding: "Through this, they will be able to make a contribution to prevent close to 9,000 small cooperative firms from collapsing and to stabilize employment of up to 350,000 people."
The Ministry of Knowledge and Economy will invest 1.3 trillion won - about 143 billion won for R&D of IT fusion systems, which is one of the nation's new growth engines, and 121 billion won for robots - and positively attract investment from related private sectors. The expected amount of private investment regarding IT new growth engines, including the IT fusion system and robots, will reach 10.6 trillion won.
On top of all that, the ministry plans to invest over 100 billion won, including 52.8 billion won secured for the digital new deal related to development of fusion software, innovation of smaller IT companies, LEDs and RFID.
Even if the ministry and energy related public companies have been under pressure to hold steady during the economic crisis, they will execute the initially planned investment of 14.3 trillion won to support smaller firms and concerned domestic consumption- related industries that are facing poor conditions.
Educational Jobs Creation
The Ministry of Education, Science and Technology has focused on overcoming the financial crisis and strengthening related competitiveness. For this, the ministry will create 50,000 new jobs in schools and research fields to relieve the problem of young job seekers and give support in the form of 60 billion won for a program helping college students and graduates land jobs. The ministry also plans to restructure related areas by liquidating improperly-run private colleges, reducing workers of educational offices and improving management efficiency of state-funded research institutes.
The Ministry of Culture, Sports and Tourism also reported plans to generate over 3,800 jobs related to cultural content and investments of 70 billion won.
When the Education Ministry and Culture Ministry jointly reported on Dec. 27, President Lee told them to think about fundamentally changing their organization, adding that the alterations should be forward-looking. Lee continuously instructed the ministers to visit work sites to check how the budget will be spent effectively so that a synergy effect can occur.
The Digital New Deal, designed to reform the industry with IT and software green technologies, and the Energy New Deal, aimed at leading the low-carbon paradigm, were suggested as two axes to overcome the economic crisis.
Two New Deals
The Ministry of Knowledge and Economy revealed a plan to create 30,000 jobs and to post the export surplus by pushing for the Digital New Deal and Energy New Deal. To this end, the government is going to invest 19,500 billion won for both measures in cooperation with public institutions and private companies.
Such a complicated strategy is aimed at preparing for the future, while maximizing current advantages, developing new investment opportunities and overcoming the ongoing crisis. This strategy also gives the country more variety in the upcoming economic system and era of development to come after going through the tunnel of depression. Both plans were made with the consideration that they can generate many high-quality jobs.
The government will also try to execute the budget and encourage private investment related to new growth engine fields without fail. The government plans to invest 1.3 trillion won for R&D of areas regarding new growth engines this year. The government also hopes to attract 10 trillion won from the private sector. The planned investment of 14 trillion won for providing so-called Green Homes, constructing energy complexes and establishing energy-saving facilities will be conducted as well. Through this, the energy industry will be developed to a new growth industry.
A goal of creating about 30,000 quality jobs by supplying new-recycling energy, commercializing software service models and supporting the expansion of outsourcing-like design consulting also is closely connected with the digital new deal. A model to maintain employment and provide educational training for surplus manpower of smaller cooperative companies provided by large enterprises will be introduced as well. The Knowledge Ministry has a plan to prepare for the future through preemptive R&D investments to develop green energy technologies and core new growth engine technologies.
Large companies will push ahead with the transformation to a low-carbon economy by improving energy efficiency and localizing new-recycling energy technologies through checking the possibility of improving thermal energy efficiency, targeting 10,000 small and medium-sized firms. They will also plan to promote the green transformation of nine main industries to secure leading competitiveness for green growth. For this purpose, the Green IT industry and green standards will be developed and resource productivity will be raised.
