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South Korea's Moon replaces ministers as sinking ratings put policy agenda at risk

South Korean President Moon Jae-in speaks at the National Assembly in Seoul

By Josh Smith and Sangmi Cha

SEOUL (Reuters) - South Korean President Moon Jae-in reshuffled his cabinet on Friday as his approval rating sank to a record low amid a backlash over housing policies, rising coronavirus cases, and a scandal involving the justice ministry and top prosecutors.

Moon nominated new ministers of interior, health, land and housing, and gender as he sought to refresh his administration, with roughly two years of his presidency to run.

Limited to a single term, and holding a small parliamentary majority, there is no obvious risk to Moon's presidency, but the drop in ratings, a resurgence of coronavirus cases and nagging domestic controversies could make it harder for him to fulfil his agenda.

Key goals include reforming the prosecutor's office, and launching an ambitious green new deal initiative to go net zero carbon by 2050. While the ruling Democratic Party's majority is uncomfortably slim, the opposition, luckily for Moon, has struggled to recover from the disarray caused by the scandals that brought down his conservative predecessor.

Moon had earned higher approval ratings earlier in the year for the government's success in handling the first wave of the coronavirus epidemic, but it is now facing difficulties containing a third wave.

On Friday South Korea reported more than 600 daily new cases, a level unseen since a peak in the spring. The outgoing health minister had faced questions over some decisions, including a relatively slow process to procure vaccines.

A survey by pollster Realmeter showed Moon’s approval ratings fell to 37.5%, down from 43.8% the previous week.

A Gallup Korea poll put his approval rating at 39%, revisiting lows recorded by that survey since he came into office in 2017. Respondents cited Moon's failure to rein in sky-rocketing housing prices, despite multiple mortgage curbs and other measures, as the main reason for marking him down.

Having come to office promising to reform politics after his predecessor was removed over corruption charges, Moon has been dogged by scandals as well.

One of his key goals has been to rein in what he sees as an overly politicized national prosecutors' office.

But critics say Moon's efforts have been driven by his own political interest in ousting a prosecutor general who has been investigating some of the president's top allies, including a former justice minister who was forced to resign in October after only a month amid corruption allegations.

Moon's new justice minister, Choo Mi-ae, suspended the prosecutor general, Yoon Seok-youl, last week, accusing him of corruption, which he denies. His suspension is being reviewed by a disciplinary committee, which will announce its findings next week.

Though he has not publicly expressed interest in politics, Yoon has now risen to the top of several polls as a popular pick to run for president in 2022.

Political analysts said it will be difficult for Moon to regather support without real policy reforms.

"A reshuffle is good when it comes to a quick response, but unless the policy is altered, a change in minister won’t bring any changes to the current housing market situation or the political row involving the prosecutor general," said Shin Yul, a political science professor at Myongji University in Seoul.

(Reporting by Josh Smith and Sangmi Cha; Editing by Simon Cameorn-Moore)