Lee Jae-myung Launches Presidency with Bold Economic and Diplomatic Agenda
Lee Jae-myung assumed the presidency of South Korea on June 4, pledging to revitalise the nation's economy and pursue dialogue with North Korea to ease tensions on the Korean Peninsula. His inauguration follows a period of political upheaval marked by the impeachment and removal of former President Yoon Suk Yeol, who attempted to impose martial law.
In his inaugural address, Lee emphasised the need to restore democratic institutions and address economic challenges exacerbated by global protectionism and domestic instability. He committed to a pragmatic, pro-market approach, aiming to deregulate industries to foster innovation and business growth. Lee also highlighted plans to implement a greener energy policy and strengthen ties with North Korea through peaceful diplomacy, while maintaining a solid alliance with the United States.
Lee's administration faces immediate pressure to resolve trade disputes with the United States, particularly over tariffs impacting key industries. The Bank of Korea has projected a 0.8% growth rate for 2025, influenced by U.S. President Donald Trump's tariff policies and domestic political instability. Lee's presidency marks a crucial shift in South Korean politics and diplomacy, balancing international relations with China, North Korea, Japan, and the U.S.
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The newly elected president also outlined his vision for social reforms, including increased welfare spending, corporate taxes, and regulatory oversight of conglomerates. Despite past skepticism of big business, he has signaled pro-market intentions to renew economic confidence following a crisis under former President Yoon Suk Yeol. Challenges await, including economic instability, rising U.S. tariffs, and strained foreign relations. Lee aims to renegotiate trade terms with the U.S. and recalibrate relations with China, Japan, and North Korea, favouring diplomacy and South Korea's autonomy in international affairs.
Lee's ascent to the presidency is notable for his background as a factory worker and human rights lawyer, symbolising resilience through adversity. His victory is largely attributed to public discontent with Yoon's administration. However, Lee's presidency begins under the shadow of legal challenges, including accusations of making false statements during a past campaign. While courts have postponed further hearings, any conviction could test constitutional protections that shield sitting presidents from prosecution.
The financial markets reacted positively to Lee's inauguration, with the Kospi index rising over 2.4%. Meanwhile, the Bank of Korea downgraded the nation's growth forecast significantly due to a slowing economy and declining exports.
Lee's administration follows a political crisis sparked by former president Yoon Suk Yeol's brief imposition of martial law. With control of both the presidency and national assembly, Lee's left-wing bloc is poised to enact reforms, including corporate governance changes aimed at empowering minority shareholders.
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Gulf Today
a day ago
- Gulf Today
S.Korea's leader to seek more time for US trade talks
Jihoon Lee and Cynthia Kim, Reuters The new South Korean administration will likely make efforts to buy time for US trade talks, as it studies the negotiations of bigger neighbours Japan and China for leverage, according to sources familiar with the ruling party's thinking. President Lee Jae-myung, who took office hours after winning the June 3 snap presidential election without a usual two-month transition period, said on the eve of the elections that "the most pressing matter is trade negotiations with the United States." The future of South Korea's export-oriented economy will hinge on what kind of deal Lee can strike, with all of his country's key sectors from chips to autos and shipbuilding heavily exposed to global trade. The new president and his liberal Democratic Party government inherit an economy that is expected to grow this year by a grim 0.8%, the weakest since 2020, and will need to unify a country deeply polarised by ousted President Yoon Suk Yeol's botched martial law attempt. South Korea and other countries may face further pressure, as a draft letter seen by Reuters showed the Trump administration wanted countries to provide their best offer on trade negotiations by Wednesday. A trade ministry official declined to confirm if Seoul had received the letter. But the transition of power after a six-month leadership vacuum provides Seoul with an excuse to slow down its negotiations and observe Washington's tariff talks with other countries, lawmakers, officials and trade experts from the Democratic Party said. "The new administration will need to take a fresh look at the overall framework of the negotiations and that will be a buffer to buy time, which the US cannot reject," said a trade expert who took part in brainstorming for Lee's trade strategies. The sources added the administration may not be able to immediately ask Trump for an extension, and Lee's top diplomacy adviser has said he sees such a request being considered only after reviewing the progress. Still, prolonged negotiations by other countries may help to buy Seoul time. "It will be strategically right to take a wait-and-see stance because the situation is changing within the United States and around negotiations of other countries," one lawmaker said. South Korea, a major US ally and one of the first countries to engage with Washington after Japan, agreed in late April to craft a "July package" scrapping levies before the 90-day pause on Trump's reciprocal tariffs is lifted, but progress was disrupted by continued upheavals in South Korea's leadership. Lee has since stressed there is no need to rush into clinching a deal and the deadline of July 8 set between Seoul and Washington should be reconsidered. During his election campaign, Lee did not make specific comments about contentious issues around the trade talks. That "silence" was a strategic move, a party official said. In a statement after his victory, the Korea International Trade Association called for Lee to "respond quickly to the rapidly changing foreign trade order" and use all of the government's diplomatic and trade resources to pursue a practical negotiation strategy. Trump's across-the-board tariffs on trading partners, including 25% duties on South Korea, have been the subject of ongoing litigation, but remain in place. "For different reasons, China and Japan will be references for us, with the former on the possibility of US policy changes and the latter on how to make moves under a similar circumstance," another trade expert said. Heo Yoon, an economics professor at Sogang University, says Lee's best bet to win an extension would be by joining the meeting of the Group of Seven advanced economies. "There is a G7 meeting in Canada in mid-June, where South Korea could be invited to join and use it as a chance to extend the tariff-pause deadline," Heo said, adding an extension could also help Washington, as it would sway Lee towards the US and away from China. Japan, another US ally slapped with 24% tariffs, no longer sees merit in striking a quick deal, unless it is granted an exemption from 25% product-specific duties on its key industry of automobiles, also a major sector for South Korea. China agreed with the US to significantly unwind their tariffs on each other in a 90-day truce signed in mid-May, but Trump last week accused Beijing of violating the agreement and threatened to take tougher actions. When it comes to joint responses to US tariffs, there is a higher possibility with Japan than China, two sources said, citing shared interest in energy purchases and auto tariffs. Lee's party expects there to be some "two-track" transitional period, with current officials continuing negotiations as the new administration formulates its strategies, according to the official. Given its strength in key sectors of US interest, such as shipbuilding and technology, some analysts see South Korea as better positioned than others in the region, as Seoul prepares a separate package of industrial cooperation for bargaining power. "Successful outcomes require offers that support the president's domestic agenda, and this will be comparatively easy for Korea given its importance in politically sensitive industries," said Jay Truesdale, a former US diplomat and CEO of TD International, an advisory firm in Washington, D.C. Kathleen Oh, Morgan Stanley's chief Korea and Taiwan economist, said: "We believe there may be more channels and enough scope for Korea to work out a deal compared to, let's say, its exporting peer Taiwan." South Korea has the scope to decrease its trade surplus with the US via more import purchases, while it can also offer lower tariffs on agricultural products, particularly rice, quoted by Trump as a high tariff example, Oh said. But, for the Lee administration, that is more the reason it does not have to rush, the second trade expert said. "In the worst-case scenario, if tariffs are adjusted after we sign an agreement, that might mean we made unnecessary concessions," the source said, adding "it's not like we don't have any leverage".
Dubai Eye
a day ago
- Dubai Eye
South Korea's new President Lee vows to revive democracy from 'near demise'
South Korea's new liberal President Lee Jae-myung pledged on Wednesday to raise the country from what he described as the near destruction caused by a martial law attempt and revive a struggling economy facing global protectionism. Lee's decisive victory in Tuesday's snap election stands to usher in a sea change in Asia's fourth-largest economy, after backlash against a botched attempt at military rule brought down Yoon Suk Yeol just three years into his troubled presidency. He faces what could be the most daunting set of challenges for a South Korean leader in nearly three decades, ranging from healing a country deeply scarred by the martial law attempt to tackling unpredictable protectionist moves by the United States, a major trading partner and a security ally. "A Lee Jae-myung government will be a pragmatic pro-market government," he said after taking the oath of office at parliament, a location where six months ago he jumped over the perimeter wall to enter the chamber and avoid martial law troops barricading it to vote down the decree. He promised deregulation to spur innovation and growth in business and pledged to reopen dialogue with North Korea while maintaining a strong security alliance with the United States. "It is better to win without fighting than to win in a fight, and peace with no need to fight is the best security," he said, referring to his country's often violent ties with rival North Korea. Lee was officially confirmed earlier as president by the National Election Commission and immediately assumed the powers of the presidency and commander in chief, speaking with the top military leader to receive a report on defence posture. With all the ballots counted, Lee won 49.42 per cent of the nearly 35 million votes cast while conservative rival Kim Moon-soo took 41.15 per cent in the polls, the highest turnout for a presidential election since 1997, official data showed. Lee has said he would address urgent economic challenges facing the country on the first day in office with a focus on the cost-of-living concerns affecting middle and low-income families and the struggles of small business owners. "With democracy alive, I hope the president will revive the economy, and have consideration for underprivileged citizens and small business owners," said Kim Eun-kyung, 58, a Seoul resident. The new president also faces a deadline set by the White House on negotiating import duties that Washington has blamed for a large trade imbalance between the countries. South Korean stocks rallied on Wednesday, with the benchmark KOSPI rising more than 2 per cent to a 10-month high, with the financial sector leading the gain on expectations of market reform by Lee. Renewable energy stocks also rose. Lee has pledged a shift to a greener energy mix. 'DEAL WITH TRUMP' In a bid to fill a long-running power vacuum, Lee nominated Kim Min-seok, a four-time lawmaker, as his prime minister on Tuesday. Kim made waves when he predicted in August last year that Yoon may declare martial law, roughly three months before Yoon's short-lived decree to impose martial law. The government under a caretaker acting president had made little progress in trying to assuage crushing tariffs announced by U.S. President Donald Trump that would hit some of the country's major industries, including autos and steel. "President Lee will find himself with little to no time to spare before tackling the most important task of his early presidency: reaching a deal with Trump," the Washington-based Center for Strategic and International Studies said. US Secretary of State Marco Rubio congratulated Lee on his election win and said the countries "share an ironclad commitment" to their alliance grounded on shared values, and deep economic ties. The White House said the election of Lee was "free and fair" but the United States remained concerned and opposed to Chinese interference and influence in democracies around the world, according to a White House official. Lee has expressed more conciliatory plans for ties with China and North Korea, in particular singling out the importance of China as a major trading partner while indicating reluctance to take a firm stance on security tensions in the Taiwan Strait. Still, Lee has pledged to continue Yoon's engagement with Japan and said the alliance with the United States is the backbone of South Korea's global diplomacy.
Khaleej Times
2 days ago
- Khaleej Times
UAE leaders congratulate President Lee Jae-myung on winning Korean elections
UAE President Sheikh Mohamed sent a message of congratulations to Lee Jae-myung on winning the presidential elections in South Korea. The Ruler also took to social media to convey his wish to the new leader. "Congratulations to Lee Jae-myung on his election as President of the Republic of Korea. Over the years, our two countries have shared strong ties of cooperation and friendship, and I look forward to working together to build upon the UAE-Korea Special Strategic Partnership and foster further growth and prosperity for our peoples." Sheikh Mohammed bin Rashid Al Maktoum, Vice President, Prime Minister and Ruler of Dubai, and Sheikh Mansour bin Zayed Al Nahyan, Vice President, Deputy Prime Minister and Chairman of the Presidential Court, dispatched similar messages to Lee Jae-myung on the occasion. South Korea's liberal party candidate, Lee Jae-myung, was elected president in Tuesday's snap election, six months to the day after he evaded military cordons to vote against a shock martial law decree imposed by his ousted predecessor. Lee's victory stands to usher in a political sea change in Asia's fourth-largest economy, after the backlash against the martial law brought down Yoon Suk Yeol, the conservative outsider who narrowly beat Lee in the 2022 election. Nearly 80 per cent of South Korea's 44.39 million eligible voters cast their ballots, the highest turnout for a presidential election in the country since 1997, with Lee terming the polls "judgment day" against Yoon's martial law and the People Power Party's failure to distance itself from that decision. With more than 99 per cent of the votes counted, the Democratic Party's Lee stood at 49.3 per cent to PPP candidate Kim Moon-soo's 41.3 per cent, according to National Election Commission data.
