SEOUL (AFP) — Former businessman Lee Myung-Bak took office as South Korea's president Monday, promising greater prosperity both for his own nation and for impoverished North Korea if it scraps its nuclear drive.
"We must move from the age of ideology into the age of pragmatism," the conservative leader announced as he was inaugurated for a single five-year term following a decade of left-leaning rule.
"Economic revival is our most urgent task."
The colourful open-air ceremony in near-freezing weather was attended by some 50,000 guests, including US Secretary of State Condoleezza Rice and Japanese Prime Minister Yasuo Fukuda.
Lee, 66, is the first president from a business background in a nation that has been ruled largely by ex-generals and then by former rights activists during its turbulent 60-year history.
He paid tribute to the economic miracle which followed the devastation of the 1950-53 Korean War but stressed South Korea must find a new growth engine.
"We are at the crossroads where the destiny of the nation over the next 60 years will be determined," Lee said in a speech after swearing the oath of office.
"I hereby declare the year 2008 as the starting year for the advancement of the Republic of Korea," he added, using the formal name of the nation founded in 1948.
Lee won a record victory margin in December's presidential election with his "Economy, First!" pledge.
The former construction CEO and Seoul mayor, nicknamed "The Bulldozer" for his forcefulness, has vowed to boost growth, cut high youth unemployment and raise competitiveness in the face of challenges from China and Japan.
"Our number one concern is how to find a job after graduation," said student Yu Byung-Kwan at the ceremony.
Lee also stressed a "pragmatic, not ideological" approach to the South's nuclear-armed communist neighbour. He expressed willingness to meet North Korean leader Kim Jong-Il when necessary.
Lee reiterated promises of massive economic aid if the North fully scraps its nuclear weapons "and chooses the path to openness."
After a decade-long "sunshine" engagement policy with the North seen by critics as a one-way street, Lee wants to tie South Korean aid more closely to nuclear disarmament.
Lee also promised a stronger strategic alliance with decades-old ally the United States, and better relations with China, Japan and Russia.
He later held talks with both Fukuda and Rice, who is touring the region to try to end an impasse in a six-nation deal on scrapping the North's nuclear programmes.
Lee and Fukuda agreed to resume top-level visits and to try to restart stalled free trade talks, in what was termed a very friendly summit.
In discussions with Rice, the president said US-SKorean relations "should have been better" in the past, according to his spokesman Lee Dong-Kwan.
"Good relations between South Korea and the US are helpful to progress in inter-Korean relations," he told Rice, who reportedly agreed.
The economy was the focus of much of Lee's inauguration speech.
"Our nation's competitiveness has fallen and instability in the resource and financial markets threatens our economy," Lee warned.
He said South Korea's middle class had "crumbled" and the lives of ordinary people were becoming harder. The country was also rapidly becoming an ageing society due to a record low birthrate.
"New engines of growth must emerge assuredly, the economy grow vigorously, and more jobs be created," he added.
He promised privatisation, tax cuts and major deregulation among other business-friendly policies aimed at raising the growth rate from around five percent last year to seven percent by 2013.
"Opening the market to the foreign sector is an unavoidable mega-trend," he said, vowing to pursue free trade pacts.
South Koreans gave their new leader a generally warm welcome.
"I greet a president who is willing to work hard for our economy," said Lee Yong-Sup, 46. "We need a fresh start. I believe he can do it."
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