SOUTH Korean President Yoon Suk-yeol on Monday (Dec 4) nominated former chief economic advisor Choi Sang-mok to be the country’s next finance minister, with the incumbent widely expected to step down to run for election.

Choi, who is replacing Choo Kyung-ho, will need to maintain economic momentum ahead of parliamentary elections in April 2024, which will determine the legislative support level for a number of Bills proposed by the government; these include the ministry’s proposal to restrict fiscal spending growth.

Park Sang-hyun, an economist at HI Investment & Securities, said: “With this (decision), Yoon is trying to make sure there is policy continuity in place ahead of the elections.” Park said Choi has been a long-time finance ministry person who spearheaded major economics policies in the Yoon administration from the very start, “so he’s a safe choice”.

The ruling party now controls only 37 per cent in the 298-member Parliament, against the 56 per cent or 168 seats held by the main opposition party.

The reshuffle comes as President Yoon’s approval rating fell for a third straight week to 32 per cent in the last week of November, from 36 per cent in the second week, data from Gallup Korea shows.

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Yoon and his ruling party will have to navigate a host of challenges in their quest to regain control of Parliament in the general election, including higher borrowing costs that have dented private consumption and added to the pressure on households grappling with elevated debt levels.

Moreover, despite the country’s restrictive policy interest rate at 3.50 per cent, consumer inflation accelerated for a third month in October amid higher food costs, far above the Bank of Korea’s target rate of 2 per cent.

Choi has a bachelor’s degree from the Seoul National University law school, where Yoon also studied at around the same time. Choi’s career in government service has been mostly in the finance ministry, overseeing economic policymaking, financial market policies, and external business relations.

Outgoing minister Choo is widely expected to run for elections in the Daegu district, a conservative stronghold in the country’s south-east, where he was born.

Yoon doesn’t need parliamentary approval to appoint a new finance minister, who also serves as deputy prime minister. REUTERS