SEOUL—South Korea's president-elect pledged on Thursday to put the economy first once he takes office and not to be shy about telling prickly North Korea to mend its ways over nuclear weapons and human rights.
Wednesday's landslide win by Lee Myung-bak, the country's first businessman president, gave an immediate filip to local shares prices, especially construction and finance firms which are seen as early beneficiaries of his conservative presidency.
"I'll create an environment where businesses will feel confident in making investments," Lee told a his first news conference since winning a single five-year term by one of the largest margins in the country's history.
In a campaign focused almost entirely on promises to reinvigorate the world's 13th largest economy, the former CEO of one of South Korea's biggest companies has said policies stifling business must be swept away, state banks privatised and foreign investors brought in.
The won currency also took heart from his victory but economists have warned that with the global economy in flux because of credit worries, Lee may struggle to meet his promise to reach seven percent annual GDP growth for an economy so reliant on exports. It is now growing at around 4.5 percent.
Those concerns were clear as local financial markets gave up early gains once traders turned their attention back to global economic problems.
"There are expectations that the new government will shift to growth-oriented economic policy," said Lee Sun-yeop, an analyst at Goodmorning Shinhan Securities.
"But for the positive momentum to be sustained in the medium term, there should be an answer to the global credit crisis."
Pre-election polls made clear that voters had little interest beyond which candidate would make them better off after what has been seen as tepid economic management under outgoing President Roh Moo-hyun.
Lee has also promised to review the policy of Roh towards North Korea, who has been criticised for being too soft on the communist state whose government has continued to develop nuclear weapons and maintained a dismal human rights record.
"The way for North Korea to advance is to give up its nuclear programmes," said Lee, who wants future aid far more closely linked to his hermit neighbour ending its atomic arms ambitions.
"If we try to point out North Korea's shortcomings with affection, I think that will go a long way toward improving North Korea's society."
The United States and Japanese governments, whose relations were tense under Roh's rule, both congratulated Lee on his victory.
"Bulldozer"
A former CEO of the giant construction arm of the Hyundai Group, Lee's penchant for big public works projects and his can-do style earned him the nickname "the bulldozer".
And he will be under strong pressure to bring in tough reforms to make his country more competitive in the advanced areas of its economy, such as finance, as its manufacturing industries are increasingly priced out of the market by lower-cost producers elsewhere.
Analysts say it was Lee's promise to boost the economy and his contrast to Roh that attracted voters to the father of four who rose from abject poverty to head, at the age of 36, what became one of the country's biggest construction firms.
Despite his popularity, Lee has been dogged by allegations of involvement in a financial scam, a problem that flared up again just before the election when parliament agreed a special investigator should look into the securities fraud allegations.
The investigation is unlikely to be completed before Lee's inauguration on Feb. 25 when he will become immune from prosecution, but it could undermine his authority if any link to the fraud is established.
It is also unlikely the liberals will give up their attack over the issue before parliamentary elections in April, when they stand to lose their majority in the National Assembly.
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