Park Geun-hye assumed the South Korean presidency in February promising to open an “era of people’s happiness” through additional social spending of Won130tn ($121bn) over her five-year term – without raising taxes. Economists were dubious, with many saying it was only matter of time until the government backtracked on the pledges that helped Park win last year’s election.
That day duly arrived on Thursday, with the publication of a budget that whittled away several of the spending promises.
South Korea’s new President Park Geun-hye’s visit to China is a big deal – not just for her but also for the country’s business leaders, given the two country’s vibrant economic ties.
A big business delegation will accompany Park for her four-day state visit to China starting on Thursday. A record 71 business people including top executives from Samsung and Hyundai will join the delegation, seeking opportunities in the world’s second-largest economy.
Does the presidential election matter in South Korea’s stock market? The equity market showed a muted reaction to Wednesday’s election but there were winners and losers – especially in construction and insurance.
Overall, the benchmark Kospi index gained 0.32 per cent to near 2,000 points, but the gains were limited as Park Geun-hye’s election victory was overshadowed by renewed concerns about the US fiscal cliff.