A lot has happened since our main session on April 18 but there remains a high degree of uncertainty.

On April 10 Koreans there was a landslide which gave 175 seats to the Democratic Party and affiliates and only 108 to the PPP. When the 12 proportional seats of Cho Kuk’s new party are added to the opposition side, the187 members are close to the point of 2/3 of members necessary for impeachment of the President, or overriding his veto.  Five more members take the count to 192.

On April 18 we reviewed the results and possible factors explaining the complexion of the 22^nd National Assembly and what it means for business.  We then considered what the consequences were for policy making and law making for the rest of 2024.  In fact two weeks after the election at the time of writing the results are still unclear with only the new Presidential chief of staff Chung Jin-suk (former deputy speaker) being appointed which the DP said was “the wrong choice.”  We do not yet have nominations for a new Prime Minister and the PPP is without a leader.  Efforts to arrange a meeting between the leader of the DP and the President have to date been stalled.

The old Assembly will still meet until late May and there is a rush to get some legislation onto the Statute book.   So our second chance meeting will look at the many uncertainties still remaining, and expectations of the character of the 22nd National Assembly which will meet at the end of May for the first time.

In our meeting there were concerns about the promises made to foreign investors by the administration.  From the point of view of business in general, many of the President’s reform concerns made sense although as in the case of the medical dispute are often unnecessarily clumsy in execution.    Can the President learn to be more conciliatory about opposition to his proposals and seek compromise before protests reach the level of the current medical dispute?  His initial reaction “to humbly accept the will of the people” points in the right direction. However his broadcast statement at the Cabinet Meeting strangely showed limited humility and rather asserted that all policies are correct and that only the explanation was poor.

Between the Presidential election of May 2022 and the present time the DP has been fairly reticient in flexing its majority muscles, but now that majority is reconfirmed by popular vote the party is likely to be more aggressive, and its new ally the National Reform Party under Cho Kuk is likely to be extremely vocal in attacking perceived abuses.  During the era of the clamour for the dismissal of Cho Kuk as justice minister both left and right mobilised a million citizens on the streets.

Meanwhile the first quarter GDP figures gave a “surprise” leap in Q1 GDP growth of 3.4% YoY.  The numbers still show a sluggish domestic economy driven by the recovery of exports and decline in imports and 20 day trade figures for April suggest that imports are no longer declining. Business and consumer confidence remains muted.

If you missed the main session of April 18 or want a snapshot of what has happened since join the online second chance.   Our main session for May will be on May 16.

Yours sincerely