South Korea election: Voters head to polls after months of political turmoil

[South Korea Holds Presidential Election]
Woohae Cho/Getty Images News

South Koreans headed to the polls on Tuesday to elect a new president after months of political instability that followed the brief imposition of martial law by former leader Yoon Suk Yeol. The winner will be sworn in on Wednesday.

The snap election was called after Yoon was ousted [https://seekingalpha.com/news/4428664-south-korea-ousts-president-yoon-after-court-upholds-impeachment-kospi-drops-86-points] in April for violating the constitution with his shock declaration of martial law in December. The military takeover was widely opposed by the public and lawmakers.

The top presidential candidates are Lee Jae-myung of the liberal Democratic Party, and Kim Moon-soo of the conservative People Power Party. Lee is favored to win, according to public opinion polls.

Reigniting economic growth will be a key focus for the next president, as South Korea's GDP contracted in Q1 for the first time since late 2020.

"The next government is inheriting a weak and fragile economy," ING senior economist Min Joo Kang noted recently, adding that if Lee is elected, "we expect fiscal policy to become more accommodative, including the introduction of new social welfare programs."

Trade will also be a priority, as the July 9 deadline for President Donald Trump's 90-day pause on reciprocal tariffs nears. If a deal is not reached by then, South Korean products will face a 26% tariff rate.

Meanwhile, Trump's sectoral tariffs have begun to dampen South Korea's manufacturing and exports, particularly in the automotive sector [https://seekingalpha.com/article/4791111-south-korean-industrial-production-drops-us-tariffs-hit].

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