Park Geun-hye

S Korea's economy must top Park Geun-hye's agenda

PUBLISHED : Sunday, 03 March, 2013, 12:00am
UPDATED : Sunday, 03 March, 2013, 3:32am

South Korea's recently-inaugurated president, Park Geun-hye, has perhaps the most unenviable job of all Northeast Asia's new leaders. A host of challenges await her attention, the biggest being an economy in the doldrums. As a backdrop, there is arch-rival North Korea's foreshadowing her taking office with a third nuclear test, negotiating choppy relations with Japan and getting ties with China right. The fact that she is the first female head of government in the heavily male-dominated society would seem to be the least of her worries.

Despite what Park faces, South Koreans are not giving her an easy ride. Opinion poll ratings give her less than 50 per cent support, far below the backing for previous incoming presidents. But while urging North Korea to embark on a path of peace and shared development was the headline-grabber of her inauguration speech, it is rejuvenating the economy that has to be her focus. With the problem so complex and only a single five-year term, she cannot waste any time.

South Korea's circumstances do not seem dire. The nation has never been wealthier, companies like Samsung and Hyundai are on a roll, unemployment is low and, through entertainment, the nation has growing international influence. But those attributes mask a falling growth rate brought about by an export-driven economy heavily dependent on European and North American markets. Then there are the social problems of a fast-ageing population, a rising number of elderly poor, insufficient quality jobs for the young and the developed world's lowest workforce participation rate for women.

Park, the daughter of assassinated dictator Park Chung-hee, can strengthen the economy through building a sturdy social welfare system and equality for women. Her pledge to break the hold of chaebols, the country's conglomerates, will help. Building trust with North Korea will be tough, but is essential to create a stable environment for growth. China and Japan are also key, though; high-quality trade pacts will ensure strong foundations for future development.