South Korea economy suffers as political logjam drags

South Korean President Park Geun-hye, who was impeached after a corruption scandal, rejected on Sunday the accusations that she conspired with a longtime friend to extort money and favours from companies.

Park denied that her jailed friend, Choi Soon-sil, influenced government decisions. She also vehemently refuted allegations that her administration blacklisted thousands of artists for their political beliefs.
It was the first time Park spoke to the media since South Korea’s opposition-controlled parliament voted on December 9 to impeach her over the scandal, which has seen millions of people protest in Seoul in recent weeks.
Park has rather accused her opponents of framing her. “The matter is under investigation, so I can’t make detailed explanations that might put both sides in trouble, but what I can assure you is that I have never conspired with anyone or did anything to give favours to someone, not even by a bit,” said Park.
Although Park has been impeached, she continues to live in presidential Blue House. The Constitutional Court has up to six months to decide whether Park should be permanently removed from office or be reinstated.
Park’s fall from grace came after state prosecutors in November accused her of colluding with her friend to strong-arm companies, including Samsung, into giving tens of millions of dollars to foundations controlled by Choi and also allowing Choi to interfere with government decisions from the shadows.
Now a new twist emerged in Park trial proceedings. The beleaguered president has refused to testify in impeachment trial that is to decide her future. It has raised questions as to why Park cannot defend herself in court when just two days ago she vehemently rejected the accusations of corruption in a hastily arranged meeting with reporters at Seoul’s presidential Blue House.
Now the Constitutional Court has delayed the start of oral arguments and asked her to testify on Thursday. The court cannot force her to appear but can proceed without her if she refuses twice to appear at the hearings.
Although Park’s dramatic maneuvering will allow her stay for some more time in Blue House, but North Koreans are very much intent on her removal. It is evident from almost weekly mass rallies demanding her ouster.
Even on New Year’s Eve, large crowds of South Koreans rallied to press for the removal of impeached president, who’s determined to restore her powers through a court trial. Protest organizers estimate nearly 9 million people took part in anti-Park rallies nationwide in the previous nine Saturdays.
The Korean people feel betrayed not just by the president’s dealings with Choi, but also because the economy has slowed and people are losing jobs. The influence-peddling scandal has really hit people emotionally.
This scandal has spawned a political and economic logjam in South Korea. The country has entered into uncharted political waters. It has hit the country’s economic growth.
The political turmoil has exacerbated fraying business confidence in Asia’s fourth largest economy. It will get worse only as companies are delaying all their business decisions due to political uncertainties. All policymaking seems to be in pause.
South Korea’s export-driven firms are also worried by the potential impact of US President-elect Donald Trump’s protectionist stance on trade issues. The consumer confidence survey shows South Koreans are at their gloomiest in 7 1/2 years. And if Park’s trial drags for months, it will hit the economy hard.