KOREA CHAIR EXPLAINS • 11/01/2021
By Ramon Pacheco Pardo
11.01.2021
President Moon Jae-in delivered the traditional presidential New Year’s Address on Monday. With his non-renewable five-year presidential term coming to an end in 2022, the speech served Moon to highlight the key goals and policies that he seeks to push for during his last full year in office. As usual, the speech focused heavily on domestic issues but also touched on foreign policy issues including inter-Korean relations. With his popularity at record lows but still higher than his predecessors at the same point in their presidency, the New Year’s Address also served Moon to discuss some of the main concerns for the South Korean population. These include the starting date for the rollout of the COVID-19 vaccine programme.
What were the key points on domestic issues?
Inevitably, the speech discussed the ongoing COVID-19 pandemic. South Korea has dealt with the pandemic very well. However, and in contrast with many European countries, the United States, China or Russia, it is yet to start administering the COVID-19 vaccine among its population. Moon promised that the vaccination programme will start next month and that all 52 million South Koreans will receive their vaccine for free. This will be welcome news for the South Korean public, which has been critical of Seoul’s tardiness in rolling out the vaccine.
Furthermore, Moon reiterated that he plans to put green growth initiatives at the forefront of South Korea’s post-COVID-19 pandemic economic recovery. In this sense, South Korea sees the pandemic as an opportunity to start a transition towards carbon neutrality. Last October, the Moon government pledged to make South Korea a carbon neutral country by 2050, in line with other developed countries. In the short-term, the South Korean government is planning a 110 trillion won investment plan to boost demand and create jobs. South Korea’s unemployment rate currently stands at 4.1 percent, up from 3.7 percent at the end of 2019. The government wants to tackle this uptick in unemployment.
What were the key points on foreign policy?
Foreign policy was not the main focus of the New Year’s address, but Moon laid out the policies that he intends to pursue during the next year. Unsurprisingly, Moon pledged to cooperate with the incoming Joe Biden administration. Relations between Seoul and Washington suffered under the Donald Trump administration, and Moon sees the inauguration of the Biden administration as an opportunity to improve the ROK-US alliance. On a related point, Moon pledged to continue its policy of engagement with North Korea. This is Moon’s strategy, and he is not going to give up on it. Seoul hopes that the Biden administration will be willing to coordinate its North Korea policy with South Korea, in contrast with the Trump administration. And Moon also hopes that there will be scope for inter-Korean negotiations to resume if the Biden administration uses diplomacy as part of its toolkit to deal with Pyongyang.
On the foreign economic policy front, Moon reiterated that South Korea is now considering joining CPTPP. Having signed RCEP, Seoul considers that it is now possible to join CPTPP as well. For Seoul, a key goal behind RCEP was to have a first trade deal including Japan. Once this has been achieved, South Korea stands ready to join CPTPP which, without the United States, has Japan as its largest economy. From Seoul’s perspective, the South Korean and Japanese economies now compete at the technological frontier. Thus, South Korean firms should not fear direct competition with their Japanese counterparts. Furthermore, CPTPP includes Mexico. In South Korea, there has long been a debate about the merits of a trade agreement with Mexico, which could be seen as a manufacturing competitor for exports to the United States. But this fear has subsided as South Korean firms have opened factories in the United States itself, have outsourced to countries such as China and Vietnam, and have become more competitive.
