S Korea's Yoon suggests 'audacious' economic plan if N Korea abandons nukes

South Korea's new president, Yoon Suk-yeol, said on Tuesday that North Korea's weapons programmes pose a threat but that he is ready to provide an "audacious" economic plan if the North is committed to denuclearisation.

Yoon gave the remarks in his inauguration speech after being sworn in at a ceremony in Seoul. He won a tight election in March as the standard bearer of the main conservative People Power Party, less than a year after entering politics following a 26-year career as a prosecutor. 

Yoon, 61, will face two major problems as he takes office: a belligerent North Korea testing new weapons and inflation threatening to undermine an economic recovery from two years of Covid-19 gloom.

He has signalled a tougher line on North Korea, warning of a preemptive strike if there is a sign of an imminent attack and vowing to strengthen the South's deterrent capability. But his speech was seen as focused more on his willingness to reopen stalled denuclearisation talks with Pyongyang. 

"While North Korea's nuclear weapon programs are a threat not only to our security and that of Northeast Asia, the door to dialogue will remain open so that we can peacefully resolve this threat," Yoon said.

"If North Korea genuinely embarks on a process to complete denuclearisation, we are prepared to work with the international community to present an audacious plan that will vastly strengthen North Korea's economy and improve the quality of life for its people," he added.

Yoon did not elaborate on his re-engagement or economic plan for the North. But his national security adviser, Kim Sung-han, told Reuters in February that his team would devise a roadmap in early days in which Pyongyang could quickly earn sanctions relief or economic aid in exchange for denuclearisation measures.

Yoon could face a security crisis if North Korea carries out its first nuclear test in five years, as US and South Korean officials warned, after it broke a 2017 moratorium on long-range missile testing in March.

NO MORE BLUE HOUSE

Yoon won the election on a platform of fighting corruption and creating a more level economic playing field amid deepening public frustration with inequality and housing prices, as well as simmering gender and generational rivalry.

South Korea's inflation hit a more than 13-year high last month as Russia's invasion of Ukraine sent commodity prices soaring, which could dampen growth prospects.

Yoon did not mention inflation, but cited low growth, rising unemployment and wage gaps as key economic challenges, pledging to address those by focusing on developing science, technology and innovation.

Some 40,000 people attended the ceremony on the front lawn of parliament, including about 300 foreign guests, including Chinese Vice President Wang Qishan, Japanese Foreign Minister Yoshimasa Hayashi, and Douglas Emhoff, the husband of US Vice President Kamala Harris.

Wang, at a meeting with Yoon, relayed Chinese President Xi Jinping's letter and invitation to China, and expressed Beijing's hopes for stronger cooperation on North Korea, bilateral and global issues.

Yoon separately met Hayashi and thanked him for conveying a letter from Prime Minister Fumio Kishida, saying he hoped to meet him soon and work together to improve relations.

Yoon promised stronger support for the US alliance to Emhoff, who also delivered a letter from President Joe Biden and said Biden was looking forward to their first summit, scheduled for this month, and was hoping for closer cooperation.

After the inauguration, Yoon moved to a new office at a former defence ministry building, holding his first meeting with aides and appointing seven cabinet nominees who had passed their confirmation hearings, including finance and defence ministers.

He has moved the presidential office and residence from the traditional Blue House under a $40 million plan, though his predecessor Moon Jae-in criticised it as rushed and a national security risk.

A separate event was held at the Blue House, where 74 citizens selected by lottery entered the long enclosed complex, which was opened to the public for the first time in 74 years.

Yoon had called the office a "symbol of absolute power," and said it would be used as a public park and cultural space.