President Lee marks one year with record Kospi and diplomatic triumphs. Can he keep it up?
Published: 02 Jun. 2026, 07:00
-
- SARAH KIM
- [email protected]
-
- SEO JI-EUN
- [email protected]
![President Lee Jae Myung delivers his inaugural address as he is sworn in at the National Assembly in Yeouido, western Seoul, on June 4, 2025, following a snap election victory. [JOINT PRESS CORPS]](https://koreajoongangdaily.joins.com/data/photo/2026/06/02/fe14b2ff-61b2-443f-b48b-5fe3ec9e00d4.jpg)
President Lee Jae Myung delivers his inaugural address as he is sworn in at the National Assembly in Yeouido, western Seoul, on June 4, 2025, following a snap election victory. [JOINT PRESS CORPS]
When President Lee Jae Myung took office on June 4, 2025, he faced a range of global and domestic challenges from the protracted leadership vacuum that followed South Korea's martial law crisis.
Lee was elected with 17.29 million votes, or 49.42 percent of the total, in the snap election the previous day, following the impeachment and ouster of President Yoon Suk Yeol over his botched imposition of martial law on Dec. 3, 2024.
Immediately after he was sworn in, Lee got straight to work without a presidential transition committee to tackle neglected state affairs, a diplomatic vacuum and a stagnant economy amid rapidly changing global and geopolitical conditions.
Perhaps the most pressing challenge was reaching a trade deal with Washington after the administration of U.S. President Donald Trump announced 25 percent tariffs on South Korean goods in April, with a three-month grace period for negotiations.
Lee held two summits with Trump in August and October last year and put out the immediate fire through reaching a trade agreement with the United States while securing Washington's approval of Seoul's pursuit of nuclear-powered submarines.
The Lee administration has also pursued broad reforms, such as controversial revisions to commercial law, to improve corporate governance and to seek new growth engines to become a global top-three AI power and advance an energy transition.
The benchmark Korea Composite Stock Price Index (Kospi), hit a new record passing the 8,700-point mark Monday, more than tripling since the 2,500 at the time of Lee's inauguration.
However, despite early milestones, Lee, as he reaches the one-year mark of his five-year term, faces continued challenges in running a country more domestically divided than ever before amid an increasingly complex international landscape, in part due to the Middle East crisis.
After taking office, Lee declared the launch of a "government of national sovereignty," defining the direction of his administration as one led by the people, putting behind the recent threats to the democratic constitutional order.
"The ultimate purpose of growth and recovery is the happiness of the people — the true masters of this land," Lee said in his inaugural address on June 4. "Let's create a truly democratic republic where the national capacity is exercised entirely for the people's sake. Setting aside petty differences to acknowledge and respect one another, let's create a country that truly belongs to the people, a country that brings happiness to the people."
Whether Lee can fulfill this pledge and meet public expectations for fair governance and better lives for the people remains to be seen.
![Korean President Lee Jae Myung, left, chats with U.S. President Donald Trump after concluding their first bilateral summit at the White House in Washington on Aug. 25, 2025. [JOINT PRESS CORPS]](https://koreajoongangdaily.joins.com/data/photo/2026/06/02/5d0734c0-dc52-459e-8457-8d6902b48d41.jpg)
Korean President Lee Jae Myung, left, chats with U.S. President Donald Trump after concluding their first bilateral summit at the White House in Washington on Aug. 25, 2025. [JOINT PRESS CORPS]
Since its launch one year ago, the Lee administration has been thrust into crisis management mode, advancing its pragmatic diplomacy to cope with global uncertainties amid U.S. tariff pressure, intensifying U.S.-China strategic competition and the Iran war. Russia's war in Ukraine has further accelerated North Korea's alignment with China and Russia.
Despite limited diplomatic experience as a former Gyeonggi governor and liberal lawmaker, Lee has navigated difficult relations with the United States, Japan and China, along with a wider range of bilateral and multilateral diplomacy, based on his approach of "pragmatic diplomacy centered on national interest," a matter interlinked with the country's security and economy.
Despite a late start to tariff negotiations with Washington, Lee, through direct talks with President Trump, opened the door to acquiring nuclear-powered submarines in their second summit on Oct. 29 in Gyeongju, North Gyeongsang, on the margins of the Asia-Pacific Economic Cooperation (APEC) summit.
After months of negotiations, South Korea agreed to a lower "reciprocal" U.S. tariff of 15 percent and committed to investing $350 billion in the United States. In return, in the security domain, South Korea secured U.S. support for developing nuclear-powered submarines and allowed for civilian nuclear energy cooperation through a bilateral Joint Fact Sheet.
![Korean President Lee Jae Myung, left, and Japanese Prime Minister Sanae Takaichi play drums together following their bilateral summit in Nara Prefecture, Japan, on Jan. 13. [JOINT PRESS CORP]](https://koreajoongangdaily.joins.com/data/photo/2026/06/02/61061764-8268-422a-9cd2-c905132c110f.jpg)
Korean President Lee Jae Myung, left, and Japanese Prime Minister Sanae Takaichi play drums together following their bilateral summit in Nara Prefecture, Japan, on Jan. 13. [JOINT PRESS CORP]
After visiting Japan in August last year, even before the United States, Lee has continued shuttle diplomacy by building trust with Japanese Prime Minister Sanae Takaichi, known for her hawkish stance, and expanding ties in areas such as energy and supply chains.
Lee also restored relations with China as part of efforts to advance economic and livelihood cooperation.
Chinese President Xi Jinping's visit to South Korea last year for the APEC summit and Lee's visit to China in January signaled a full restoration of bilateral relations soured following the deployment of the U.S.-led Terminal High Altitude Area Defense (Thaad) antimissile battery nearly a decade ago.
South Korea's successful hosting of the APEC summit in Gyeongju in late October further demonstrated its diplomatic capacity to manage a multilateral event that brought together global leaders.
![Korean President Lee Jae Myung, left, takes a selfie Chinese President Xi Jinping using a Xiaomi smartphone during a state dinner in Beijing after their bilateral summit on Jan. 5. [JOINT PRESS CORPS]](https://koreajoongangdaily.joins.com/data/photo/2026/06/02/703e2cb2-614a-4baf-92a5-87c3d782e09b.jpg)
Korean President Lee Jae Myung, left, takes a selfie Chinese President Xi Jinping using a Xiaomi smartphone during a state dinner in Beijing after their bilateral summit on Jan. 5. [JOINT PRESS CORPS]
Lee, at the same time, has sought to de-escalate tensions and pursue dialogue with North Korea, but has failed to achieve a clear breakthrough, as Pyongyang has maintained its "two hostile states" stance and rebuffed Seoul's gestures for talks.
In his Liberation Day speech last year, Lee declared three principles toward North Korea: respecting the North's system, not pursuing unification by absorption and refraining from hostile acts. He further announced a phased restoration of the inter-Korean military agreement of Sept. 19, 2018, which had been suspended under the previous administration.
Despite such peaceful overtures, there has been no visible progress in inter-Korean relations.
"The past year was one where practical diplomacy achieved meaningful results," said Kim Jae-cheon, professor of international relations at Sogang University's Graduate School of International Studies. "There were initially concerns that the administration might lean toward a pro-China, anti-U.S. and anti-Japan stance. However, focusing the policy framework primarily on the South Korea-U.S. alliance was a sound decision, and within that framework, the administration has successfully restored and managed relations with China."
However, he pointed to ongoing issues, such as the slow follow-up to the trade deal and the Coupang dispute.
"There are clear achievements in the first year since the administration's launch," said Cha Du-hyeogn, vice president of the Asan Institute for Policy Studies.
"Practical diplomacy means avoiding a dogmatic fixation on a specific ideology or value that prevents one from seeing other interests, rather than simply doing whatever is convenient at any given moment," Cha said. "If handled poorly, it can leave the impression that actions are taken merely for convenience without any overarching philosophy or principle. We must guard against this, as it risks losing the trust of all sides."
Likewise, for North Korea, Cha pointed out that "expecting the other side to change voluntarily when we possess no leverage is an incredibly fragile structure, adding it will be important for Seoul to "clearly establish our center of gravity in relations with major powers."
![The benchmark Korea Composite Stock Price Index (Kospi) closes at a record high of 8,788.38 on June 1, as seen in a financial data screen in the dealing room of Woori Bank in Seoul on June 1. [NEWS1]](https://koreajoongangdaily.joins.com/data/photo/2026/06/02/ef8b10a3-5452-4405-859c-35202e12e7de.jpg)
The benchmark Korea Composite Stock Price Index (Kospi) closes at a record high of 8,788.38 on June 1, as seen in a financial data screen in the dealing room of Woori Bank in Seoul on June 1. [NEWS1]
The Lee government has prioritized overcoming the economic downturn caused by the martial law crisis to build a foundation for renewed growth.
Within a month of taking office, it prepared a 31.8 trillion won supplementary budget ($21 billion) to support people's livelihoods and revive the struggling economy and cash handouts to encourage consumption.
Exports also exceeded $700 billion annually for the first time last year, with the latest projections suggesting it could top $900 billion this year.
The Kospi has set a series of new records, breaking 7,000 for the first time in early May and 8,000 last week, despite volatility amid the Iran war.
Concerns nonetheless remain over the underlying risks behind the stock market boom, with some analysts warning that strong market performance and export growth may be an illusion driven by semiconductor giants Samsung and SK hynix.
The so-called three highs, a strong exchange rate, high oil prices tied to energy instability and high inflation leading to rising interest rates, continue to pressure businesses and households.
Recent labor-management disputes at Samsung Electronics over the allocation of excess semiconductor profits also present broader societal challenges.
Likewise, ongoing issues such as stabilizing rising housing prices, labor protection and youth unemployment also point to deeper structural issues.
Direct, real-time communication
On his first day in office, Lee, after beginning work at the Yongsan presidential office, said, "It really feels like a tomb."
Former President Yoon, after his inauguration in May 2022, had moved the presidential office to the Defense Ministry complex in Yongsan, central Seoul, to fulfill a pledge to become a more approachable president.
In keeping with a campaign promise, Lee moved the presidential office back to the old Blue House compound in central Seoul in late December, as Yongsan had become synonymous with the imposition of martial law.
Perhaps in keeping with changing times, Lee is showing himself to be more open to real-time, direct communication than any South Korean president before him, introducing livestreamed governance by broadcasting Cabinet meetings in full and posting his thoughts on key issues of the day directly on social media.
Since July 29 last year, deliberations at Cabinet meetings presided over by Lee have been broadcast live in full every week via television and YouTube. By the end of last year, government briefings to the president were also broadcast live.
Such livestreamed governance initiatives reflect the Lee administration's vision of transparent communication directly to the people. His predecessor, Yoon, also promised to be a president who would communicate better with the public and the press, but those promises fizzled.
The live broadcasts have also tested both the sharp-tongued president and his Cabinet members, who sometimes impressed with well-prepared responses to Lee's ad-lib questions, while others struggled.
Lee has also been an active user of X, frequently sharing his views on major state affairs around the clock from the beginning of the year.
As a part of efforts toward balanced regional development, Lee has held town hall meetings across the nation, engaging directly with residents and taking unscripted questions from the public. Starting in Gwangju in June of last year, Lee held town hall meetings in 12 metropolitan cities and provinces to date.
![President Lee Jae Myung, center, takes questions from locals at a town hall meeting held on Jeju Island on March 30. [JOINT PRESS CORP]](https://koreajoongangdaily.joins.com/data/photo/2026/06/02/03f2e71d-c6a6-4221-bcf4-2c4f01338707.jpg)
President Lee Jae Myung, center, takes questions from locals at a town hall meeting held on Jeju Island on March 30. [JOINT PRESS CORP]
One year into his term, Lee has maintained an average approval rating in the 60 percent range, higher than recent presidents in the same period, except President Moon Jae-in, whose approval was in the high 70 percent range.
However, significant challenges remain for Lee to sustain momentum over the remaining four years of his administration.
Beyond resolving the martial law crisis, there are growing calls to heal deep national divisions, as both the ruling Democratic Party and the main opposition People Power Party show little sign of compromise or mediation, instead tilting toward more extreme stances that primarily cater to their support bases.
While Lee, despite pledging to be a "president for all" in his inaugural address, has made some efforts toward national unity, including appointing figures from conservative circles and seeking to talk with opposition leaders, these efforts are seen as insufficient.
Bipartisan cooperation would be essential to accomplish Lee's reform policies, including restructuring the prosecution and judicial systems.
However, one year after the launch of the Lee administration, the standoff between the rival parties has grown fiercer than ever. The outcome of the June 3 local elections can further deepen this division and contribute to governance that can be disconnected from the broader public's will.
In terms of diplomacy, analysts point out that it will be important to follow up on the summit talks and agreements to obtain more tangible outcomes.
"In truth, absolutely nothing has improved regarding the surrounding geopolitical environment," said Kang Jun-young, professor of Chinese studies at the Hankuk University of Foreign Studies' Graduate School of International Studies. "Ultimately, the areas where tangible and visible results can be achieved are economic exchanges and cooperation on livelihood issues. If we fail to deliver on these fronts, public skepticism will rise […] Therefore, the key priority for the second year is the concrete execution of practical achievements."
BY SARAH KIM, SEO JI-EUN [[email protected]]
with the Korea JoongAng Daily
To write comments, please log in to one of the accounts.
Standards Board Policy (0/250자)