SEOUL, South Korea — When President Lee Jae-myung saw a viral video last month of a migrant laborer being mistreated at a South Korean brick plant, the 61-year-old — who suffered a debilitating injury himself while working in a factory as a child — was stunned.
“I couldn’t believe my eyes,” he wrote July 24 on social media, calling the incident an “unacceptable act of violence against minorities and the vulnerable.”
In the video, a forklift operator lifts and moves another worker bound with plastic wrap to a pallet of bricks, drawing laughter from off-camera.
Mr. Lee ordered an investigation and then visited the factory, which is notorious for previous industrial accidents.
SPC Group, the factory’s owner, had already announced sweeping new safety initiatives as part of its efforts to wriggle out of the gun sights of Mr. Lee, who is delivering on campaign promises to make businesses accountable for abusive labor and consumer practices.
It is not populist grandstanding but a potentially game-changing strategy that aims at “The Korean Discount.”
Under that rubric, Korean stocks have been undervalued compared with global peers for decades. Some investors blame the undervaluation on the ever-present risks posed by North Korea, while others say the discount stems from dubious corporate governance.
Korean conglomerates are globally admired, but at home are notorious for founder-family privilege, managerial opacity and disinterest in shareholder rights.
Mr. Lee aims to add value by raising dividends.
He has vowed to stamp out white-collar crime by closing legal loopholes to ensure that penalties outweigh gains and by instituting a “one strike and you’re out” rule for malfeasances like insider trading.
The plan — preliminary legislation has already passed — is working. In his first month in office, the benchmark KOSPI index stood at 2695 points. On Friday, it topped 3119 – within reach of 2021’s historical high of 3316.
The potential is seismic. Distrusting capital markets, Koreans have customarily invested in Seoul real estate, leading to huge disparities in home prices.
Mr. Lee offers hope to “ant investors” — retail punters known for their huge numbers and their wee investments.
Promoting shareholder capitalism is an unlikely policy direction for a politician who was, until recently, considered a hardcore leftist. But Mr. Lee’s shift into center-right territory — a move he proclaimed in February that upgraded his electability among the middle class — is holding.
Meet the president
A local politician before ascending to national stature, Mr. Lee is hounded by allegations that range from illegally sending funds to North Korea to lying to the electorate. Eyebrows have also been raised by suicides among his aides.
Widely despised by conservatives — he survived a stab to the jugular in 2024 — he nevertheless won the June election with a solid 49.42% of the vote. That election followed the impeachment of President Yoon Suk Yeol after his December martial law ploy — a ploy Mr. Lee personally combated.
Fortified by presidential immunity against his alleged crimes, and with his Democratic Party of Korea holding a majority in the National Assembly, he has a powerful mandate through the next legislative election in 2028.
Some fear he is trying to coerce the judiciary. Business circles resent a new bill that extends legal protection for strikers. And concerns simmer over some of his personnel appointments.
However, a late July opinion poll showed that he had a 60.1% approval rating among the public.
Middle-of-the-road citizens, who surveys find are massive supporters of the U.S. alliance, are likely happy that he has finally been invited to Washington.
That calmed jitters that Korea was being overlooked amid President Trump’s prioritization of deals with larger economies such as China, the E.U., Japan and Britain.
A Washington win
Mr. Trump’s Wednesday announcement of a trade deal with South Korea on par with Japan’s deal — a 15% tariff on Korean exports to the U.S. — was accompanied by an invitation to Mr. Lee to summit in the next two weeks.
Trade talks had been under wraps. Post-deal, Mr. Lee was upbeat, saying, “We have achieved significant results.” Speaking to government officials, he compared himself to a duck trying not to get dragged downstream by currents, and revealed he had not spoken up during negotiations as it might have “had a negative impact.”
Mr. Lee has surprised in other areas.
Noted in the past for anti-Japanese rhetoric, he has — in a rare carryover from his impeached predecessor, Mr. Yoon, whose flagship foreign policy was upgrading Tokyo ties — maintained solid relations with Tokyo.
That has been reciprocated by Japanese Premier Shigeru Ishiba, who last month attended a reception at Tokyo’s Korean Embassy, and on Wednesday received Mr. Lee’s foreign minister.
Seoul-Tokyo amity pleases Washington’s security sphere, which has long sought trilateral defense ties.
Mr. Lee’s long-held hopes for better relations with North Korea look shakier.
In one of his first policies, he silenced Seoul’s cross-border propaganda broadcasts. The North reciprocated the following day. Messaging since has been less hopeful.
Mr. Lee “is no different from his predecessor in blindly adhering to the South Korea-U.S. alliance and pursuing confrontation,” said Kim Yo Jong, influential sister of national leader Kim Jong Un, in a state media commentary last week. “There will be no chance of us sitting down with South Korea for any discussions.”
That restates her brother’s 2023 position, which nixed hopes of peaceful reunification, dismantled related agencies, and called the Koreas “belligerent states.”
She followed up the following day, over the same channel.
“If the U.S. fails to accept the changed reality and persists in the failed past, the [North Korea]-U.S. meeting will remain as a ‘hope’ of the U.S. side,” she said.
It is unclear whether the “changed reality” refers to Pyongyang’s expanded nuclear arsenal since the 2018-2019 Kim-Trump summits, or its cozy new relationship with Moscow, which offers it benefits that reduce the necessity for Seoul and Washington ties.
North Korea is “doing what it always does,” said Yang Uk, a security expert with Seoul’s Asan Institute. “They can sew controversy through one or two commentaries; it’s a strategic game for them.”
Mr. Yang said he had feared the Seoul-Washington relationship might “go south,” but Mr. Lee’s trade negotiators delivered. Still, he was concerned about what might happen when Mr. Lee meets Mr. Trump.
There are expectations that Washington will compel Seoul — which, under Mr. Lee, has revived long-delayed plans to remove Korean troops from under U.S. command in wartime — to take on a bigger role in conventional defense.
That means Mr. Lee must negotiate a quid pro quo, Mr. Yang suggested.
“If Seoul were to take over the burden for conventional deterrence, the U.S. must take a bigger step on nuclear deterrence,” he said.
