S. Korean president announces cabinet reshuffle nominees

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(Agencies)
Updated: 2009-09-03 15:35

SEOUL: South Korean President Lee Myung-bak shuffled his cabinet on Thursday as he tried to strengthen his push for business-friendly economic reforms through a deadlocked parliament.

Tax cuts and labour reform topped the agenda when parliament started a new session on Tuesday, but signs that Asia's fourth largest economy may be pulling out of a slump faster than expected have eased pressure on lawmakers to push through reforms.

S. Korean president announces cabinet reshuffle nominees

Chung Un-chan, former president of Seoul National University, speaks during a news conference at the university in Seoul September 3, 2009. Chung, a professor of economics at the university, was nominated for Prime Minister by President Lee Myung-bak who carried out a Cabinet reshuffle on Thursday. [Agencies]

Lee named Chung Un-chan, an economics professor at Seoul National University, to be his prime minister and take on steering legislation in the biggest change to his line-up that included fresh faces at five other ministries.

The selection of Chung, a prominent economist and former university president, comes after Lee had seen many of his reforms stalled in a parliament because of friction in his ruling conservative Grand National Party (GNP) and opposition protests that have sparked fights in the National Assembly.

"The cabinet reshuffle will have a big impact, because parliament is looking for a prime minister who will not create any huge controversies," said Jeong Chan-woo at Min Political Consulting in Seoul.

Lee, who has seen his support numbers improve as the economy has picked up, faces the middle years of a single five-year term. By law, South Korean presidents can only serve a single term.

He wants to avoid the fate of many of his predecessors who saw their power and prestige fall in the period as a fickle public turned its attention to the race for the next leader.

Chung is considered a Keynesian economist who values the role of policy to correct inefficiencies in the private sector. He has opposed tax cuts and criticised large public works projects planned by Lee, who was formerly a construction boss.

Lee also named as defence minister Kim Tae-young, who has served as chairman of the Joint Chiefs of Staff, and is a two-term lawmaker. Career bureaucrat Choi Kyung-hwan was appointed commerce minister.

The nomination of the prime minister requires parliamentary approval while appointments to other cabinet posts do not.

Parliament may delay a plan proposed for this session for a 1 percentage point tax cut for businesses and individuals starting from 2010 so as not to widen deficits brought about by stimulus spending, GNP lawmakers told media.

Lee shuffled his top aides on Monday to strengthen his team for a mid-term push as he presses for pension reform, adding greater flexibility to financial services and winning approval for a trade deal with the United States.

Analysts said he also wants to appear more of a centrist and will push welfare measures in order to widen his support.