Park lays out 3-year economic innovation plan

The second year of President Park Geun-hye's government will focus on laying the groundwork for innovation and improvement of the overall economic conditions that can be palpable to the people.

To that end, President Park said during a news conference marking the new year that she will launch and successfully carry out the so-called three-year economic innovation plan this year and open the "era of people's happiness."

"In order for people to feel the actual achievement, we will establish the three-year economic plan for innovating and making another leap in our economy," Park told reporters.

She said that the government will push forth a plan centered on three objectives -- strengthening economic fundamentals, nurturing an innovative economy and creating a balanced economy where not just exports but also domestic demand are stimulated.

With the three-year plan, Park said that the country's growth potential is expected to grow to around 4 percent and the annual per-capita income level to exceed $30,000 and move toward $40,000.

Park noted that there are many "chronic abnormalities" in the economy and said she will work hard to root them out in order to build an economy based on a strong foundation.

"Among other things, we will start with the reform of the public sector. Some public organizations are having difficulty even in paying interests on debts they owe with their operating profits," Park said.

Her commitment to public sector reforms is a reminder that the government will keep its pressure for public organizations to tackle their ballooning debt problems and lax management practices.

Last month, the government unveiled its public sector "normalization" plan in which it called on public companies to come up with measures aimed at reducing their debts and rectifying any "abnormal" management practices.

The move comes as major public organizations have come under fire for doling out what many see as excessive bonuses, benefits and perks to their employees despite their fast-growing debts and deteriorating business conditions.

Park also emphasized the importance of nurturing domestic demand in order to generate more jobs and achieve a balanced economy. She promised to provide special support to small and medium-sized companies in a way that boosts domestic demand.

"It has become evident that generating jobs and boosting domestic demand would be tough or impossible to achieve with just manufacturing sector-driven exports," Park said. "We will provide support for smaller companies in a way that would encourage them to expand investment and contribute to boosting domestic demand."

Asked how the government will deal with the fast-depreciating Japanese yen, Park called on businesses to intensify efforts to enhance their competitiveness.

She also encouraged businesses to capitalize on free trade agreements that the government has signed with other countries in making inroads into overseas markets.

"Businesses should take this as an opportunity to cut costs, enhance competitiveness through restructuring and actively venture out into markets abroad. This will help us turn the crisis into an opportunity," Park said.

"It is true that the falling yen presents a burden on our economy. We still outperform Japan in terms of free trade agreements ... and it would be helpful for companies to effectively utilize them," she added. (Yonhap News)