How S. Korea's new president plans to revitalize economy

The new president's first executive order was launching an emergency task force to address urgent economic challenges and improve the daily lives of the people.

Our economics correspondent Lee Soo-jin takes a closer look.

South Korea's newly elected President, Lee Jae-myung, is swiftly moving to deliver on a key campaign pledge revival of the economy.

His spokesperson announced on Wednesday that President Lee had signed his first executive order.

"On June 4th, 2025, his first day in office, President Lee Jae-myung signed his first executive order, calling for the establishment of an Emergency Economic Task Force."

This comes as growth projections for South Korea's economy have been revised downward by both domestic and foreign institutions.

The Bank of Korea just last week slashed its GDP growth forecast for this year to zero-point-8 percent from 1-point-5 percent in its economic outlook report.

And the OECD on Tuesday lowered South Korea's 2025 growth forecast to 1 percent, down zero-point-5 percentage points from its earlier projection.

While it is yet unclear who will take on the dual role of finance and deputy prime minister, the appointee is expected to lead the task force in overseeing pressing economic issues.

This includes overseeing a planned economic supplementary budget amounting to 30 trillion won, or 22 billion U.S. dollars

to boost domestic demand.

But as the ruling Democratic Party is expected to maintain a majority in the National Assembly for the next three years until the 2028 general election, the new administration is likely to face fewer hurdles in carrying out its policy agenda.

The new administration will also have to navigate high-stakes negotiations with the Trump administration.

Korea and the U.S. held high-level trade talks in April where the two countries agreed to reach a comprehensive agreement dubbed the "July Package" by July 8th the day that the 90-day pause on Trump's "reciprocal" tariff rates on foreign nations is set to expire.

The Ministry of Economy and Finance is also expected to be restructured, as Lee, since his candidacy, has pledged to transfer the Finance Ministry's budgeting role to a separate body.

The ministry currently oversees both economic policy and budget allocation, but Lee argues this concentrates too much power in one place.

The separation of the budgeting function is expected to allow other ministries to gain more autonomy and accountability over their spending, while allowing the Finance Ministry to focus more on coordinating overall economic policy.

Lee Soo-jin, Arirang News.