Lee Han-joo, chairperson of the National Research Council for Economics, Humanities and Social Sciences (NRC) and special presidential adviser for policy, said on the 29th that "the government has no choice but to maintain expansionary fiscal policy for the time being."
Lee is known as President Lee Jae-myung's economic mentor and the architect of the "basic society" policy. When the president led the Democratic Party of Korea, Lee headed the Institute for Democracy, and after the Lee Jae-myung administration launched, Lee served as chairperson of the Presidential Committee on Policy Planning, the equivalent of a presidential transition committee. In Nov. last year, Lee was appointed chairperson of the NRC, which oversees 26 state-funded research institutes in economics and the humanities and social sciences, including the Korea Development Institute (KDI).
At a press briefing on the first day after taking office, Lee said, "There are very many areas of the Korean economy that need budget support." Lee added, "We have come this far having barely addressed inequality, and enormous financial resources are needed to pursue technology-led growth, including artificial intelligence (AI)." Lee continued, "Because the role of fiscal policy is important as priming water, the government has no choice but to maintain an expansionary fiscal stance for the time being."
Lee said, "The real economy and the potential growth rate are the problem." Lee said, "The 2025 economic growth rate is estimated to be near 1%, but stock prices have more than doubled." Lee added, "IT, semiconductors and automobiles are racing ahead very quickly, but there are weak areas such as construction, lodging and retail," and said, "The government should also focus on the economy affecting people's livelihoods." As for why the real economy is not recovering despite the recent rise in stock prices, Lee said it is "because those who hold some large-cap stocks that are rising reap gains, but many others do not."
Meanwhile, Lee said, "We will make state-run research institutes the first practical think tanks the president and government ministries turn to when they face policy questions." Lee added, "We must not remain an organization that simply produces research reports," and said, "We will do our utmost to ensure government policies bring tangible changes to the lives of all people." As a first task, Lee said the administration will objectively verify the policy effects of the pilot project for a basic income program for rural communities, one of this government's national tasks.