South Korea Legislative Elections: Divided Government to Continue

Overview
South Korea’s election for its 300 seat National Assembly held on April 10, 2024, resulted in a landslide win for the opposition Democratic Party (DP). The DP captured 175 of the 300 seats, while their allied party, the Rebuilding Korea Party (RPK), won another 12 seats. In contrast, seats held by President Yoon Suk Yeol’s conservative People Power Party (PPP) declined from 114 to 108. According to the National Election Commission, the voter turnout was 67% of the eligible 44 million voters – the highest for a parliamentary election since 1992. The results for the PPP are less damaging than expected from the exit polls, which projected that the DP would win between 180-200 seats. The recently launched RPK party, led by former Justice Minister Cho Kuk, could play a key role if the DP aims to take any legislative actions requiring a three-fifths majority (180 seats). Still, with the lack of a super majority in the opposition coalition (a two-thirds majority, or 200 seats), President Yoon will be able to utilize his presidential veto.

Key Highlights

-- South Korea's main opposition party expanded its majority in the April 10 parliamentary elections.

-- President Yoon's low approval ratings, coupled with the continuation of an opposition-led coalition in the National Assembly, will likely hamper Yoon's reform agenda.

-- That said, from a macro perspective, South Korea's credit fundamentals remain solid, with growth expected to gradually accelerate through next year.

“An opposition-led coalition in the National Assembly will likely limit progress in implementing President Yoon’s business friendly reform agenda,” said Rohini Malkani, Senior Vice President Global Sovereign Ratings, “but South Korea’s credit fundamentals remain solid and resilient and we expect limited impact of the elections on the economy.”