"Economic vitality in the private sector has not recovered sufficiently because of the country's dual labor market, losing corporate competitiveness and low growth in the world economy."

Korea's exports, the country's key economic driver, plunged 18.8 percent in January from a year earlier, the largest on-year drop in more than six years, as low oil prices undermined demand from emerging countries and China, its biggest trade partner, slowed down.Also, its domestic consumption showed some signs of slowdown as the consumer price index grew less than 1 percent last month for the first time in three months.

The Seoul government announced an extra stimulus package earlier this month to prop up the economy, spending 40 percent of its 330.6 trillion won ($267.8 billion) budget for 2016 in the first three months of the year.

Along with the fiscal policies to invigorate the economy, Yoo called for sweeping reform in the financial and labor sectors.

"To overcome the external and internal downside risks, an improvement in the economic structure is needed," said the minister, asking the public firms' leaders to spearhead the economy-boosting efforts and the government-led reform campaign.

As part of the government plan to improve efficiency in the public sector, a performance-based wage system will be adopted by all public corporations and agencies by the end of 2016. (Yonhap)