Asia St: Challenges Loom After Korea’s Narrow Election Outcome

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Challenges Loom After Korea’s Narrow Election Outcome

March 10, 2022

Photo Credit: Chosun.com

BGA’s Korea Team, led by Managing Director B.J. Kim, released an update following South Korea’s narrow election outcome. The update addressed some of the dynamics of the election as well as the implications for economic and foreign policy.

Context

  • Yoon Suk-yeol of the main conservative opposition People Power Party (PPP) on March 10 defeated Lee Jae-myung of President Moon Jae-in’s Democratic Party (DP) with a 0.73 percent point lead of just 240,000 thousand votes, marking the narrowest margin of victory in Korea’s history.
  • Many polls before the vote had predicted Yoon’s narrow victory, but pollsters did not expect such a razor-thin margin. 

Significance

  • With the DP’s absolute controlling majority in the legislature, Yoon faces daunting challenges to leading his evenly divided country. Yoon is expected to lean on market principles rather than government intervention in economic policies.
  • Not all of Moon’s legacy may be discarded. His business-supporting science-and-technology policies for digital, green and bio industries are likely to continue under different names in the Yoon government.

Implications  

  • The Yoon government will be more willing to cooperate with Biden’s economic and national security initiatives including efforts to rebuild Seoul-Tokyo-Washington trilateral cooperation, marking a departure from the Moon government’s more cautious approach.
  • North Korea may lash out with new missile tests during the early period of Yoon’s presidency to demonstrate that a conservative government in Seoul results in heightened tension on the Korean peninsula. China may also send Yoon warning signals as he breaks with Moon’s more deferential stance toward Beijing.

BGA will continue to keep you updated on developments in Korea as they occur. If you have any questions or comments, please contact BGA Korea Managing Director B.J. Kim at bjkim@bowergroupasia.com