Next president must prioritize the economy
Published: 26 May. 2025, 00:00
![An ad for fast loans is seen posted near a downtown area of Seoul full of small-business restaurants on April 25. [NEWS1]](https://koreajoongangdaily.joins.com/data/photo/2025/05/26/f4b67bc0-e9c7-4e3d-ba75-ed5a0e16142a.jpg)
An ad for fast loans is seen posted near a downtown area of Seoul full of small-business restaurants on April 25. [NEWS1]
Democratic Party presidential candidate Lee Jae-myung said Sunday that if elected, his first move would be to form an emergency task force on economic response. His rivals, People Power Party candidate Kim Moon-soo and Reform Party candidate Lee Jun-seok, have both pledged deregulation to revive the economy. Yet across the board, the rhetoric of crisis has outpaced the presentation of concrete strategies.
The Korean economy is showing signs of systemic distress. Domestic consumption remains weak, global uncertainty is rising amid renewed tariff disputes and annual growth is expected to hover near zero percent. As the country faces declining birthrates, an aging population and stagnating industrial innovation, concerns about a prolonged low-growth era are intensifying.
Small businesses and self-employed workers are among the most vulnerable. According to Korea Credit Data, average revenue per small business in the first quarter of this year was 41.79 million won ($30,500), down 12.9 percent from the previous quarter. Personal debt is mounting. Loans to sole proprietors totaled around 719 trillion won as of the end of Q1, an increase of 15 trillion won on year. Roughly 499,000 of the 3.62 million businesses with loans shut down during the same period.
The signs are growing more ominous. Even cafes, which saw a boom during the pandemic, have declined in number for the first time, according to National Tax Service data. The number of convenience stores and fried chicken outlets has also decreased. Many who turned to self-employment for lack of job opportunities are now retreating amid high inflation, high interest rates and oversaturated markets.
Despite the economic slump, Seoul’s housing market is beginning to stir again. Ahead of the third phase of the debt service ratio (DSR) cap taking effect in July, apartment prices in the capital, which had cooled, are rising again. With loan conditions set to tighten, last-minute borrowing is driving up transactions. At the same time, uncertainty surrounding post-election real estate policy is fueling speculative demand.
![A vacant storefront stands on a street in central Seoul on May 18. [YONHAP]](https://koreajoongangdaily.joins.com/data/photo/2025/05/26/50a22574-bf99-4452-a0bc-716b0ff2b368.jpg)
A vacant storefront stands on a street in central Seoul on May 18. [YONHAP]
Whoever takes office must act decisively. Fiscal policy should focus on stimulating domestic demand, and the real estate sector requires swift intervention to prevent broader instability. Voters deserve more than populist pledges. The next administration must present a credible, growth-driven strategy that strengthens the foundations of the economy and creates jobs.
Translated from the JoongAng Ilbo using generative AI and edited by Korea JoongAng Daily staff.
with the Korea JoongAng Daily
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