By Joyce Lee
SEOUL, Sept 1 (Reuters) – South Korean President Lee Jae Myung’s top economic policy lieutenant has stepped down days after a cabinet reshuffle following public concerns about uneven growth and doubts over whether he can deliver on a pledge to improve housing affordability.
Lee on Tuesday accepted the resignation of Kim Yong-beom, chief presidential policy adviser and a key architect of his expansionary fiscal policy, efforts to revitalise the financial markets and policies to ease crushing price pressure in the housing market.
Critics have also blamed Kim for being a key force in South Korea’s listing of single-stock leveraged exchange-traded funds (ETFs), tied to the world’s two top memory chip producers, a move seen to have heightened volatility in the stock market, which had been among the world’s best performers.
Kim’s departure follows a cabinet reshuffle announced on Sunday, in which Lee’s office named six new ministers including replacements for the economy and finance minister and the land minister, as well as new presidential aides. Lee had also replaced the country’s top trade envoy in August.
The president’s approval rating fell 1.3 percentage points to 38.9%, a Realmeter poll released on Monday showed, its first drop into the 30% range since Lee took office in June last year.
The pollster said concerns over housing prices and rental costs had weighed on public sentiment.
Lee has spearheaded a drive to end speculative buying of residential properties by tightening borrowing requirements, but many working families have said the policy had affected their ability to own a house.
As most major polls pointed to a continued slide in Lee’s support from a high of nearly 70% earlier in the year, analysts said he will likely need to do more than a change of faces to address growing public anxiety about his policy initiatives.
‘LEE NOT YET IN DANGER’
“Looking at past cases, there are almost no examples where a cabinet reshuffle has raised a president’s approval rating,” said Shin Yul, a political science professor at Myongji University, adding that replacing ministers alone was unlikely to persuade voters that government policy would change.
An approval rating in the 30% range was a serious warning sign that could weaken the administration’s ability to advance its agenda, as “less and less of what the administration says gets through to the public,” he said.
Shin added the housing issue was fundamentally a matter of public trust, citing what he described as repeated shifts or reversals in policy.
Many political analysts attribute the liberal camp’s failure to retain the presidency after former President Moon Jae-in’s 2017-2022 term in part to his government’s missteps in trying to stabilise soaring housing prices.
Moon, who enjoyed record-high approval ratings shortly after taking office, was succeeded by conservative Yoon Suk Yeol, who defeated Lee in the 2022 presidential election before being removed after briefly declaring martial law in 2024.
Jeremy Chan of the Eurasia Group said Kim’s removal, on top of the cabinet shakeup, showed “there was no natural scapegoat for two recent policy failures: rising housing prices and the introduction of the single-stock leveraged ETFs.”
“I don’t think Lee or his administration is in any immediate danger, but he clearly feels the need to arrest the slide in his public support,” Chan said.
(Reporting by Joyce Lee and Brenda Goh, Writing by Jack Kim Editing by Ed Davies and Saad Sayeed)
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