`Geun-hye nomics` and Center for Creative Economy & Innovation

“Will the Center for Creative Economy & Innovation go well? It was created in such haste.” “It’s all fault of the Ministry of Science, ICT and Future Planning. The president ordered that in January, but the ministry wasted time.” “The ministry can’t help because the president ordered in January after budget allocation ended. That’s why the ministry twisted arms of conglomerates.” “I understand how the ministry`s officials feel now. The next administration would get rid of the ministry, probably officials are not eager to work.” “Next government would abolish the Center for Creative Economy & Innovation.”

This is a snapshot from a recent discussion at a gathering. The Center for Creative Economy & Innovation is a tangible result of the creative economy driven by the President Park Geun-hye administration. In the Center for Creative Economy & Innovation system, 17 large businesses are individually matched with a region across the country. The assigned conglomerate commercializes ideas or technologies from local ventures and helps local ventures to advance into the global market. Samsung is assigned to Daegu, Hyundai Motor is matched with Gwangju, and SK is paired with Daejeon. At the center`s launching ceremony held in Daegu in September, President Park and Samsung Electronics Vice Chairman Lee Jae-yong attended to mark its splendid beginning.

According to the economic circle, the center was created in haste a few days before the announcement was made. Most of conglomerates were notified, “The government is pursuing this, so take care of a certain region,” right before the announcement. The ministry gathered representatives from the participating companies at a meeting and made public the creation of the Center for Creative Economy & Innovation. Major businesses, suddenly assigned to a region to help its future growth, are busy developing ideas. It may be too early to criticize it as a hastily-made policy. If some companies do their best, some regions may have successful results. But bitter taste is left as the center`s policy seems to reveal the hidden side of creative economy, one of the main pillars of "Geun-hye nomics."

The government released an additional economic stimulation strategy worth 5 trillion won (approximately 4.65 billion U.S. dollars) as the economy is now stepping backwards after recovering since the inauguration of Finance Minister Choi Kyung-hwan. The government intends to boost sluggish economy first, and solve the long-term issues such as structural reform. However, there is criticism as to whether the economic stimulation is a right solution for an economy with a 3.7-percent growth rate. Critics are saying that it is more urgent to make efforts to increase the potential growth rate itself, rather than focusing on boosting short-term economy higher than its potential growth rate. If the government’s policy such as Center for Creative Economy & Innovation goes well as intended to boost basic economic strength, it will be a great help to revive the economy.