By Lee Chi-dong
Staff Reporter
The government has revised this year’s growth target to the 6 percent range in a bid to create as many as 3.5 million jobs.

``The growth rate hovered around 3 percent last year,’’ Finance-Economy Minister Kim Jin-pyo said in an interview. ``The earlier forecast of 5 percent growth is not enough to offset (last year’s) poor performance and recover growth potential.’’

The government will make policy measures aimed at achieving 6 percent growth this year, he added.

It is the first time a high-ranking policymaker has officially discussed a 6 percent level growth target for the new year.

The economy last year performed poorly with more than 40,000 jobs lost in 2003 alone, as the country slipped into its first recession since the 1997-98 Asian economic crisis, amid dull consumption. The youth jobless rate soared to a record high of 8 percent.

It highlights the seriousness of the country’s chilly job market, which had seen 400,000-500,000 new jobs created every year between 1999-2002.

``Promotion of corporate investment and creation of jobs will be the top priority this year,’’ Kim said. ``The government plans to let state-run banks, including Korea Development Bank, loan 2 trillion won to the service sector in an effort to create 3.5 million jobs this year.’’

He expressed confidence that the growth target can be met as exports will chalk up better numbers this year and private spending is expected to pick up soon.

Experts also back the government’s 6 percent growth target.

``The country’s growth potential is estimated to reach 6 percent, thanks to high productivity and low inflation, although the figure will vary according to the definitions,’’ Choi Gong-phil, an economist from the Korea Institute of Finance said. Generally, growth potential refers to the maximum growth rate an economy can achieve without triggering serious inflation.

But the problem is that the specter of jobless growth is spreading its shadow over the entire economy.

``In that sense, the government should focus its policy on expanding the market base through globalization efforts, like free trade agreements, instead of promoting the current input-driven growth strategy,’’ he stressed.

Kim also reiterated his suggestions to grant amnesty to business leaders who are embroiled in the current political slush fund scandal.

``It’s true that they violated the law,’’ he said. ``We will have to think about showing leniency to some of them as long as political parties reach a bipartisan consensus and implement safeguard measures to prevent the reoccurrence of such practices.’’

Kim also said the government will announce a package of measures next Monday to redraw the line between industrial giants and financial companies.

``The package will contain tougher requirements for industrial conglomerates in establishing or running financial companies,’’ he said.

With regard to the LG Card problem, Kim stressed that the situation is close to a resolution, but large shareholders of the credit card issuer should share the responsibility for losses.

lcd@koreatimes.co.kr