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Yahoo! My Yahoo! Mail Yahoo! Search Search: Sign InNew User? Sign Up News Home - Help Navigation Primary Navigation Home Singapore Asia Pacific World Business Entertainment Sports Technology Top Stories Most Popular Secondary Navigation Singapore Asia Pacific World Search Search: FACTBOX-Key issues under South Korea Lee's presidency Reuters - 2 hours 3 minutes ago SEOUL, Feb 25 - South Korean President Lee Myung-bak on Wednesday marked his first year in office. ADVERTISEMENT The conservative, former CEO won the presidency by the largest margin in any democratic South Korean election, promising to reform and revitalise Asia's fourth largest economy, repair diplomatic ties with major trade partners and get tough with neighbouring North Korea. But from his early stumbles in his transition period before assuming the presidency, Lee has struggled to maintain his popularity. His approval rating in recent months has rarely been above 30 percent. Though the figure has started to rise, one poll this week showed 54.4 percent think he is doing a poor job. THE ECONOMY Taking power with a promise to achieve long-term 7 percent growth, Lee quickly saw his hopes disappear. His finance minister came under early criticism for inflexible policies and for pursuing growth at the cost of more pragmatic policies to deal with mounting global and domestic economic problems. Since Lee took office, the won and share prices are both around 40 percent lower. Latest data shows that exports, the economy's mainstay, have plunged by a third with weakening domestic demand unable to pick up the slack. Lee brought in a new finance minister this month who admitted what economists had long been predicting -- the economy this year will contract for the first time since the Asian financial crisis a decade ago. FOREIGN RELATIONS Key diplomatic relations, despite some early thorny patches, have generally improved under Lee. He became the first South Korean president to be hosted at Camp David, when he met then U.S. President George W. Bush. But he returned home to find his agreement on U.S. beef imports had triggered mass anti-government protests in the capital. Similar attempts to mend fences with Japan took an early knock from disputes over ownership of a small group of islands and Japanese textbook revisions related to its colonial rule of the Korean peninsula in the first half of the 20th century. But ties have since largely improved. He resumed shuttle summits with Japan and held a first trilateral summit with the leaders of Japan and China and has been active in pushing for a more prominent role for the Group of 20 countries -- of which South Korea is a member -- in tackling the global economic slump. DOMESTIC POLITICS It is in this area that he has faced some of his biggest challenges. Problems quickly emerged in relations with his defeated rival to win the leadership of the conservative party which made if difficult for Lee at the start of his presidency. He also spent much of his first year confronting vocal civic groups, who last June brought tens of thousands to the streets to protest his agreement to import U.S. beef. Though he also led his party into a sweeping win in the April parliamentary election, a hostile opposition has meant delays for many of Lee's planned reforms. NORTH KOREA Ties with North Korea worsened sharply after Lee ended the 10 years of free-flowing aid of his left-leaning predecessors by making assistance conditional on moves by Pyongyang to end the development of nuclear arms. The fatal shooting of a South Korean tourist just across the border last year saw tensions increase and relations between the two states are now all but frozen. North Korea has launched a relentless verbal assault on Lee and his government and threatened war. Lee has so far refused to change tack, promising to reward the North if it behaves. He received a morale boost from visiting U.S. Secretary of State Hillary Clinton this month who told Pyongyang to stop its war of words against the South if it wanted better relations with Washington. SOME KEY CHALLENGES Economic recovery: Lee's government is working to get a supplementary budget through the fractious parliament to lift the falling economy. Some analysts say his government may be willing to see the currency remain relatively cheap and make exports more competitive and drive a recovery later in the year. Investor fears: The government faces a fresh bout of nerves from investors, speculating that local banks may have trouble rolling over foreign debt. Concerns are also growing the won will be hit hard again if troubles in east European economies trigger capital flight out of emerging markets. Irascible North Korea: The increasingly angry rhetoric could turn into physical conflict although most analysts expect any clash to be relatively low key. However, the North is preparing a long-range missile launch which is seen as a fresh provocation and threat to regional stability. Email Story IM Story Printable View Blog This Recommend this article Average (0 votes) Sign in to recommend this article » Most Recommended Stories » Related Articles: Business Seoul shares end up helped by KT, but trim gainsReuters - 1 hour 37 minutes ago Nikkei snaps 3-day losing streak, Honda powers upReuters - 1 hour 9 minutes ago Japan's top automakers report plummeting outputAP - 1 hour 39 minutes ago Indian bond yields up on supply fears; cbank eyedReuters - 1 hour 42 minutes ago Chinese pension fund to step up foreign investmentAP - 1 hour 43 minutes ago Most Popular – Business Viewed First Chinese-American governor likely Obama commerce pick Iraqi police shoot dead four US soldiers: ministry 34,000 apply for 'the best job in the world' Bernanke eyes recovery, Japan PM call for dollar confidence World stocks mostly rally on Citigroup report View Complete List » Search: Home Singapore Asia Pacific World Business Entertainment Sports Technology Top Stories Most Popular Copyright © 2009 Yahoo! 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