Just weeks into his presidency, South Korea’s newly elected leader Lee Jae Myung is wasting no time tackling the country’s economic woes. In his first formal address to parliament on Thursday, Lee urged lawmakers to swiftly approve a 30.5 trillion won ($22.5 billion) supplementary budget aimed at jumpstarting growth in Asia’s fourth-largest economy.

Lee rose to power in a dramatic political shakeup earlier this month, following the impeachment of former president Yoon Suk Yeol, whose controversial declaration of martial law in December ended in widespread unrest and his removal from office.

Now, with South Korea’s export-driven economy staggering under the weight of external shocks and shrinking domestic activity, Lee is calling for urgent intervention.

“Timing is everything when it comes to the economy, and now is the time to act,” President Lee told lawmakers in Seoul’s National Assembly chamber.

The proposed stimulus package — equivalent to roughly $22.5 billion — is centered on immediate relief. Over 40% of the spending will go toward universal consumption coupons, with each eligible citizen set to receive up to 520,000 won (around $380). Lee described the move as “the minimum” needed to revive consumer spending and stabilize livelihoods.

The president's urgency comes as South Korea grapples with five straight quarters of dismal growth. GDP contracted in Q1 of this year, with both private consumption and public spending declining. Meanwhile, inflation ticked up to 1.9% year-on-year in May.

Much of the current downturn is being blamed on rising global trade tensions. In April, U.S. President Donald Trump imposed a 25% tariff on South Korean imports as part of his broader protectionist campaign. While the tariffs are temporarily on hold until July, the uncertainty has rattled markets and further strained Seoul’s export sector.

Against this backdrop, Lee’s economic plan is widely expected to sail through the legislature, where his center-left Democratic Party holds a commanding majority in the 300-seat assembly.

Turning to foreign policy, President Lee reiterated his campaign commitment to re-engage North Korea through unconditional dialogue. He argued that regional stability is not just a diplomatic imperative, but an economic one.

“I will create a virtuous cycle where peace drives economic growth, which in turn further strengthens peace,” he declared.

Lee takes office at a moment of strategic tension for South Korea, caught in the crosscurrents of an intensifying geopolitical rivalry between the U.S., its longtime security ally, and China, its biggest trading partner.

As he navigates these complex waters, all eyes will be on how South Korea's new leader balances diplomacy, economics, and the need to restore public trust in government.

Stay with WafricNews for continuing coverage of leadership transitions and economic developments across the globe.


By WafricNews Desk.