Lee Jae-myung government puts regulatory overhaul front and center
Lee Jae-myung Government Pins Hopes on Regulatory Overhaul... Pushing for Speed on Startups and Industry
President Lee Jae-myung declared that "unnecessary regulations will be boldly swept away." The move elevates regulatory reform to the top priority of his economic policy. Pointing to the difficulties faced by entrepreneurs, President Lee noted that "the procedures are complicated the moment you try to start a business," arguing that the economy cannot regain vitality without clearing away such unnecessary regulations.
The emphasis on regulatory overhaul is seen as a signal of the Lee Jae-myung government's pragmatist line. The government is reportedly planning to reassess regulations industry by industry, prioritizing the removal of rules that obstruct startups and investment. In the startup ecosystem in particular, there has been persistent criticism of the heavy administrative burden in the early stages of launching a business, and the government's underlying judgment is that lowering entry barriers directly leads to job creation. The government's urging of faster housing supply at the third-phase new city sites is interpreted in the same context: slow administrative procedures such as supply permits delay market responses as well.
Semiconductor Exemptions Expanded... But With Strings Attached
Industry attention is focused on labor deregulation. President Lee said the 52-hour workweek exemptions would be applied to the semiconductor industry, but stated that "paying premium wages for overtime is a precondition." Semiconductor plants face massive losses when equipment stops running, classifying the industry as one where long working hours are unavoidable. However, the government's approach aims to guarantee worker compensation at the same time, rather than easing rules solely for corporate convenience.
This conditional approach is analyzed as a compromise that accommodates industry demands while minimizing backlash from labor. Expanding exemptions without premium pay could throw wage systems into disarray, so the government has chosen to loosen regulations while maintaining a framework of "labor-capital balance." The plan dovetails with the push for a semiconductor cluster in the Honam region. The National Assembly Research Service analyzed that operating this cluster would require power equivalent to five or six nuclear reactors, and calls are growing for labor and permitting regulations to be sorted out first if the large-scale industrial complex is to become reality.
Approval Rating Back in the 40s, Securing Momentum for Governance
Politically, the tide is turning in the president's favor as well. In a Gallup Korea poll, President Lee's approval rating broke out of its slump and returned to the 40-percent range for the first time in seven weeks. Some interpret this as evidence that pragmatic economic policies like regulatory overhaul have helped win over centrist voters. President Lee's remark that the New Village (Saemaul) Movement started by former President Park Chung-hee "remains highly useful even today" is also read as part of his pragmatist course. Emphasizing that North Gyeongsang Province is "the proud home of the New Village Movement" and that the government will support it sends a message aimed simultaneously at balanced regional development and at courting conservative voters.
The rebound in approval ratings also affects the government's legislative and administrative momentum. President Lee has continued to engage with the opposition, approving the KBS board appointments of Lee Gang-deok and Jang Han-sik nominated by the People Power Party, and on the 18th he posted on social media to the effect that "opposing views are respected." The revival of the Blue House special inspector follows the same line. With the ruling party recommending lawyer Kil Soo Choi as special inspector and adopting his confirmation report, a decade-long gap has finally been filled. The move restores a mechanism of self-oversight for the audit power, and is expected to reinforce the image of transparent governance amid the recovery in approval ratings.
Tasks Ahead and Outlook
The success or failure of the regulatory overhaul hinges on the speed of implementation. The key questions are how concretely the government identifies which regulations to scrap and how quickly it resolves inter-ministerial conflicts of interest. As for the semiconductor 52-hour workweek exemption, labor-management negotiations over premium pay standards and scope of application remain, so legislative delays cannot be ruled out.
Nevertheless, with the approval rating back in the 40s, the regulatory overhaul underway, and the oversight mechanism restored, the Lee Jae-myung government is assessed as having secured its most stable governance momentum since taking office. If tangible results of regulatory reform translate into corporate investment and startup indicators, a virtuous cycle could emerge in which a felt economic recovery feeds back into political support. Over the coming months, as the list of regulations to be scrapped takes shape, conflicts of interest between labor and industry are highly likely. But the government's stated principle that "premium pay is a precondition" is expected to serve as the baseline for negotiations.
