[2020 National Audit] Bank of Korea: "Government Structural Reform is Desirable... Current Evaluation is Difficult"

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[Asia Economy Reporter Eunbyeol Kim] The Bank of Korea stated that the policy direction of the structural reforms implemented by the government is desirable. However, it added that it would take a considerable amount of time for policy outcomes to appear, and it is difficult to evaluate the results as the impact of the novel coronavirus infection (COVID-19) affects the overall economy.

On the 16th, in materials submitted to Choo Kyung-ho, a member of the National Assembly's Planning and Finance Committee from the People Power Party, the Bank of Korea said, "Structural reforms are essential to overcome structural problems such as the decline in growth potential and population aging that our economy faces," and "the policy direction is considered desirable."

The government has been promoting structural reforms such as regulatory innovation, strengthening support for new technologies and new industries, and advancing key industries and the service industry.

The Bank of Korea said, "It is important to steadily and consistently pursue structural reforms through policy efforts to achieve tangible results that the public can feel."

However, when asked to evaluate this, it said, "Policy outcomes appear only after a considerable period following policy implementation," and "since the COVID-19 shock has had a significant impact on the overall economy, it is difficult to evaluate the outcomes of structural reform policies."

Regarding labor market policies and reforms, the Bank of Korea also stated, "It takes a long time for labor market policies to show concrete results, and the COVID-19 shock has greatly affected the labor market," making it difficult to evaluate specific outcomes at this point.

Regarding regulatory reforms such as the regulatory sandbox, the regulatory responsibility system, and the Venture Investment Act, it also postponed evaluation, saying, "The outcomes of regulatory reform policies appear only after a considerable period following policy implementation."

When asked to evaluate the structural reform efforts of the Lee Myung-bak, Park Geun-hye, and Moon Jae-in administrations, it said, "Since these structural reform efforts overlap by period, it is difficult to evaluate specific outcomes by each government."

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