First Woman President of South Korea Seen in Dictator’s Daughter

The late President Park Chung Hee left South Korea with two political legacies, as overseer of the nation’s economic miracle and its longest-ruling dictator. Now there’s a third: His daughter is front runner to become the country’s first female president.

Park Geun Hye, 60, who led the New Frontier Party to an unexpected majority in South Korea’s April 11 parliamentary election, has topped opinion polls for 11 weeks, even though she has yet to declare her candidacy for the Dec. 19 election. Park may announce her candidacy as early as next week, according to party officials.

The never-married, eldest daughter of the former leader has supported her father’s export-led growth policies since becoming acting first lady at 22 after her mother was killed in a bungled North Korean attempt to assassinate the dictator. As demand falls in Europe and youth unemployment rises, she faces the task of embracing policies that may raise wages and broaden welfare as popular support for the outgoing president slumps.

“The key agenda for this year’s election is not more jobs but better jobs and better welfare,” said Lee Nae Young, a political science professor at Korea University in Seoul. “Park Geun Hye has shown signs of inching closer to the center to a more welfare-oriented stance on the economy.” Park declined requests for an interview.

The winner in December will take over from President Lee Myung Bak, whose non-renewable five-year term ends in February. Lee faces mounting discontent for his failure to deliver on election promises in 2007, when he beat Park to the party’s nomination. The former chief executive officer of Hyundai Engineering & Construction Co. (000720) pledged to set the economy on a path of 7 percent annual growth to reach per-capita income of $40,000 by 2017, pursuing policies based on industrial growth similar to those of Park’s father.

Approval Drops

Instead, the global slowdown cut growth to 3.6 percent last year, income disparity has risen, youth unemployment is nearly double the national jobless rate and the benchmark Kospi stock index has slid 10 percent in three months. Lee’s approval rating has more than halved since he took office, to 28.6 percent in a June 18-22 poll by Seoul-based Realmeter.

“Five years with Lee Myung Bak have taught voters that blind pursuit of growth is not the priority anymore,” said Kang Won Taek, a political science professor at Seoul National University. “Voters want someone who can offer not only growth but also more quality jobs for all, with welfare.”

Yesterday, the Finance Ministry cut its growth estimate for this year to 3.3 percent, from 3.7 percent, and announced 8.5 trillion won of spending to support the economy.

Lee’s support crumbled further last year when aides and senior lawmakers were involved in a series of corruption scandals, prompting Park’s appointment as leader of a crisis commission to revive the party’s image.

‘Must Change’

“If we want to be the trustworthy party, the people must change and the policies must also change,” said Park in a January speech announcing reforms that included changing the 15- year name of the Grand National Party to New Frontier and toning down a hard-line stance on North Korea.

Both the ruling and opposition parties have named job creation and welfare as top campaign issues.

“We don’t have a proper system set up to respond to aging, temporary jobs and youth unemployment,” Park said at a forum last November. “While the government has increased the budget and implemented diverse policies, the people haven’t been able to feel the effects.”

In distancing herself from the current president’s policies, Park may also weaken government support for the nation’s biggest companies, which have been rocked in the past years by family infighting and corruption allegations.

Veer Away

“What Park will need to decide is how far left toward the center they want to go with their welfare policies,” said Yonsei University Professor Yang Seung Ham, who teaches political science. “She may have to veer from her father’s favored policy of supporting the big businesses to create jobs, and turn to strengthening small- and medium-sized enterprises.”

Such a change would come after the central bank warned that risks to growth from Europe’s slump are increasing. The Bank of Korea kept borrowing costs unchanged for a 12th straight month in June. Exports, which account for about half of gross domestic product in Asia’s fourth largest economy, contracted for the third consecutive month in May, with shipments to the European Union slumping 16 percent from a year earlier in the first 20 days of the month, according to government statistics.

The graduate of Seoul’s Sogang University studied electrical engineering to support her father’s policy of promoting the country’s practical sciences.

Backing Chaebols

Park Chung Hee took power in a military coup in 1961 and ruled until 1979, forging growth in automaking, steel and shipping by backing the chaebols, family-run multinational businesses like Samsung Group, whose main electronics unit now accounts for one fifth of the country’s gross domestic product.

Under his rule, per capita income expanded more than six- fold, from $255 in 1970 to $1,693 in 1979, according to central bank data. He altered the constitution to increase his power and used torture, censorship and public executions to crack down on dissidents and political opponents. His control of people’s lives included bans on rock music, mini-skirts and long hair.

Park Geun Hye’s possible return to the presidential Blue House would cap a political career that began with her duties as acting first lady in 1974, a role that forced her to abandon her studies in Paris. Five years later, after her father was assassinated by his own spy chief, she dropped off the political stage, spending the next 18 years in a life of seclusion and philanthropy until another national crisis -- the 1997 Asian financial slump -- brought her back.

Hope, Despair

“I couldn’t stand back and watch the strong economy that my father envisioned, go to ruins,” Park said in her autobiography, “Despair Trains Me and Hope Moves Me,” published July 2007.

Park, who met the late North Korean leader Kim Jong Il in Pyongyang in May 2002, has also softened the party’s stance toward its Northern adversary, removing calls in its charter for North Korea to improve human rights and abandon its communist ideology.

Relations between the two sides slumped after President Lee rolled back his predecessors’ “Sunshine Policy” of engagement. In the tensions that followed, 50 South Koreans were killed in 2010 when a border island was shelled by the North and a South Korean warship was sunk by a torpedo. The North has denied sinking the vessel.

Software Magnate

Park’s main rivals in the election may include software magnate Ahn Cheol Soo, 50, an independent whose business success and donations to charity have won him support from younger voters; and Moon Jae In, 59, a human-rights lawyer with the opposition Democratic United Party, who was jailed in 1975 for participating in street protests against the rule of Park’s father.

Park leads the polls with 41.1 percent, versus Ahn’s 19.2 percent and Moon’s 15.1 percent, in a survey of 3,750 people on June 18-22. The poll, by Seoul-based Realmeter, had a margin of error of plus or minus 1.6 percentage points.

Park may have a tough time winning over younger voters who have no memory of her father’s regime. The opposition parties tend to perform better when there is greater youth turnout, the National Election Commission said in a report this month that analyzed the April 2012 parliamentary vote.

Snow White

“With her slightly outdated pant suits and that never- changing 1970s hairstyle, she symbolizes tradition and the conservative values of the ancien regime,” said Park Won Ho, a Seoul National University professor who specializes in South Korea’s voting orientation.

Park has made an effort to change the aloof profile that earned her nicknames such as “Princess Geun Hye” or Snow White, making nationwide appearances during the campaign for the April parliamentary election, smiling broadly and hugging vegetable sellers.

Meanwhile, she retains support from many older voters who remember the growth days of her father.

“Park spent her childhood and early adulthood at the Blue House and has been in politics for over 20 years; no other politician has that much training, experience or exposure,” said Kim Sook, a 67-year-old shopkeeper in southeast Seoul. “Life was tough under Park Chung Hee, but you could feel the economy getting better. Now you don’t feel anything.”

To contact the reporter on this story: Sangwon Yoon in Seoul at syoon32@bloomberg.net

To contact the editor responsible for this story: Peter Hirschberg at phirschberg@bloomberg.net

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