MEET MADAM PARK: South Korea's President-elect Park Geun Hye waves to supporters outside the headquarters of the ruling Saenuri Party in Seoul on December 19, 2012 (XINHUA/AFP)
The new president-elect of South Korea, Park Geun Hye, is a political record setter in East Asia, becoming the first ever female president in a region with deep patriarchal traditions. With the landmark election over, the new leadership will be tasked with easing tension on the Korean Peninsula, seeking a regional balance and restarting the six-party talks on resolving the Korean Peninsula nuclear issue.
From victory to economy
South Korea's 18th presidential election was held on December 19, 2012. Park, the ruling Saenuri Party candidate and daughter of late President Park Chung Hee, won the election after garnering more than half of all votes—a first since democratic elections began in the country in 1987. According to the South Korean Constitution, the president should be directly elected by voters for a term of five years.
"This was a close contest," Shi Yongming, an associate research fellow on Korean Peninsula studies with the China Institute of International Studies, said to Beijing Review. "The winner must focus on the economy and regional security."
Polls taken prior to the formal vote showed a close race between Park and her rival, Moon Jae In of the main opposition Democratic United Party. The two major candidates ran on similar platforms in terms of general administrative ideas, Shi pointed out. Park is a bit more conservative than Moon, winning a majority of voters aged 50 to 60, while the younger generation from 20 to 40 years old generally preferred Moon, Shi said.
Shi noted that being a candidate of the ruling party was an advantage for Park. Moreover, voters expected Park to resume the country's economic development that took place under her father's administration from 1963 to 1979.
According to a report by the Hyundai Research Institute, Park's presidential election promises included an increase in social welfare spending, high-quality job creation and fair trade regulation on big corporations. The growth in social spending would require the government to find ways of financing such as higher taxes, which may cause disputes, the think tank said. South Korea is now the world's 13th biggest economy, with a per-capita GDP of $24,000.
Analysts said one of Park's most pressing tasks is to adopt effective socioeconomic policies to reduce social conflicts caused by the country's economic structure largely ruled by business conglomerates known as chaebols.
South Korea's economy is dominated by family-controlled corporate groups such as Samsung and Hyundai. The top 10 enterprises' combined turnover has exceeded 40 percent of South Korea's total processing industry. For example, Samsung's 2010 sales reached 22 percent of the country's GDP, and its export volume was 20 percent of the country's total exports.
Giant enterprise empires and their branches have made it harder for small and medium-sized enterprises in the country to compete, said Zhan Xiaohong, a researcher on economic studies with the Chinese Academy of Social Sciences (CASS). Furthermore, scandals related to insider trading and bribery of government officials added to the anti-chaebol sentiment, Zhan added.
Zhan pointed to chaebols as a source of dissatisfaction in South Korea, which is one reason why both Park and Moon called for fairness and efforts to ease polarization in the country.
Zhan said Park pledged democratization of the economy, calling for a reduction in the power of chaebols. But she insisted on a coexistence of giant as well as small and medium-sized enterprises.
South Korea's economy has been relatively better off amid the global financial crisis, as the East Asian economic footing remains solid. However, the country's economic structure is still fragile, said Shi. Like the Japanese Government, the South Korean Government cultivates giant enterprises to boost the country's economy. But unlike Japan, South Korea has not built a channel for chaebols to voice their demands lawfully. Consequently, chaebols directly intervene in the country's policy planning, leading to further social conflicts.
The South Korean Government cannot break up giant enterprises because they have control over the country's economic foundation. " South Korea should establish a communication channel between the government and chaebols," Shi said.