March 10, 2017 / 8:52 AM / 10 months ago

Park ouster frees up Seoul for the real fight

HONG KONG (Reuters Breakingviews) - South Korea can now move onto the real fight. A ruling by the country’s Constitutional Court to uphold the impeachment of President Park Geun-hye clears the path to an election. That should end the political paralysis in the country, giving the polarized nation a chance to find common ground on critical economic reform and big geopolitical problems.

The decision, made unanimously by an eight-member panel, means South Korea can start to draw a line under one of the biggest corruption scandals in its history. Park, the 65-year-old daughter of a former dictator, is the nation’s first democratically elected president to be ousted. It also sets the tone for the trial underway of Samsung heir Jay Y. Lee, who has been indicted on related bribery charges.

The focus will now turn to a snap election to be held within two months. Given the political climate, South Korea’s next leader is now most likely to be from the opposition. Whoever wins, though, will have a short honeymoon.

Domestically, economic growth is faltering below 3 percent. Cosy ties between the government and companies are fuelling calls for broad corporate reform. Bloated industries, such as shipbuilding, and an inefficient labour market need to be restructured too.

South Korea is staring at even more problems overseas. First, there is China. A decision to allow the United States to deploy the THAAD anti-missile system in South Korea has riled Beijing. It is blatantly retaliating by giving South Korean companies in the People’s Republic a hard time and restricting tourism visitors. North Korea’s erratic behaviour exacerbates the sense of vulnerability in Seoul.

Meanwhile, there have been jitters over whether Washington will name South Korea a currency manipulator, given its big current account surplus. South Korea is among the emerging markets that are most vulnerable to accusations of stealing Western jobs that are liberally levied by the U.S. administration of Donald Trump.

Seoul needed the impeachment of Park to be able to tackle these problems with the attention that they deserve. Her successor will still need to work hard to win over Park’s many supporters – but clearing the deck certainly makes it easier than it would have been otherwise.


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