Candidates propose divergent economic plans ahead of election

With less than two weeks until South Korea’s presidential election, leading candidates have unveiled contrasting plans to revive the struggling economy.

Democratic Party candidate Lee Jae-myung proposed aggressive government bond issuance and increased fiscal spending to boost growth. Lee dismissed concerns over rising national debt, saying, “It is misguided to claim the country should never borrow. During the COVID-19 pandemic, other nations took on debt to support their citizens, but we did not.” A senior aide added, “Given the current debt-to-GDP ratio, additional bond issuance is not a major concern.”

In contrast, People Power Party nominee Kim Moon-soo emphasized deregulation and tax cuts as the keys to economic revival. He pledged to reduce the top corporate tax rate from 24% to 21% and create a more business-friendly environment to spur investment and job creation. Kim’s team also left open the possibility of a second supplementary budget focused on targeted support for small businesses and self-employed workers, distinguishing their approach from the Democratic Party’s broader welfare initiatives.

Meanwhile, Reform Party candidate Lee Jun-seok advocated for regional flexibility in setting minimum wages and reducing regulatory burdens on small business owners to foster competitiveness and self-reliance.

Experts remain skeptical about the candidates’ proposals. “All plans rely heavily on fiscal stimulus to revive the economy, but raising the necessary funds without increasing taxes is unrealistic," Professor Lee Jeong-hee of Chung Ang University said. "Moreover, overcoming Korea’s prolonged low-growth trend will not happen quickly.”

With economic growth hovering below 1%, voters await a viable path forward as the next administration faces mounting challenges amid global trade tensions and structural stagnation.


조응형 기자 yesbro@donga.com