Welcome to the AKBC Business Connect - June Edition

Dear Subscriber,

This month marked a pivotal shift in Korea’s political landscape with the inauguration of President Lee Jae-myung on 4 June. While his past positions had raised concerns — including criticism of the US troop presence and sympathy with China’s opposition to the THAAD system — President Lee’s early steps in office have signalled a far more pragmatic approach than many expected. In just a few short weeks, he has moved quickly — assembling a cabinet, announcing a major stimulus package, and engaging with global leaders, including at the recent G7 Summit, where he met Prime Minister Anthony Albanese. Their meeting reinforced the strength of the Australia–Korea relationship, especially in areas like energy, defence, and APEC cooperation.

Domestically, President Lee’s biggest challenge is economic. Korea’s export-heavy economy is under pressure from weakening global demand and rising protectionism, with concerns over US tariffs increasing. His announcement of a ₩30.5 trillion (AUD 34 billion) supplementary budget is aimed at stimulating domestic demand through direct payments to citizens, although questions remain about rising debt levels and whether such short-term measures will translate into sustained growth. The budget follows an earlier ₩13.8 trillion injection in May, highlighting just how urgently the new administration is moving to stabilise the economy. Demographic headwinds — including a rapidly ageing population and one of the world’s lowest birth rates — further compound Korea’s long-term economic challenges.

On the political front, President Lee’s Democratic Party holds a clear majority in the National Assembly, giving him a strong platform to advance his legislative agenda. His early cabinet appointments — including Korea’s first civilian defence minister in over six decades — reflect his intention to deliver on campaign promises and reshape civil–military dynamics. Meanwhile, his softer tone on North Korea, including halting loudspeaker broadcasts and signalling openness to renewed dialogue, marks a distinct shift from the previous administration.

Earlier this month, Jenny, Belinda and I travelled to Korea to progress preparations for the 46th KABC–AKBC Joint Meeting in Seoul this September. We had productive meetings and were encouraged by the strong interest from both Korean and Australian stakeholders. You will find more detail on the trip — as well as registration information for our upcoming events in the rest of this newsletter. I hope to see many of you in Melbourne next month or in Seoul come September.

Warm regards,

Liz Griffin

Chief Executive Officer

Australia–Korea Business Council

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