"Outlook for the Next Year: 42.6% Expect Deterioration vs 40.4% Improvement, Split Opinions"[President Lee's '100 Days in Office' Survey]

Regulatory and Trade Uncertainty Emerge as Top Corporate Concerns
Major Companies Rate Business-Friendly Environment at Just 20?30 Out of 100
Yellow Envelope Act and Commercial Act Amendments Seen as Demotivating Factors for Businesses

As the 100th day of President Lee Jaemyung's term approaches, a recent survey revealed that expectations for the domestic economy over the next year are evenly split between those predicting deterioration and those expecting improvement.

According to the "100 Days in Office: Corporate Business Environment Assessment" survey conducted by Asia Economy from September 1 to 3, targeting the top 50 companies in Korea (with responses from 47 companies), 20 companies (42.6%) forecasted that the domestic economy would somewhat worsen over the next year. In contrast, 19 companies (40.4%) anticipated some improvement. Eight companies (17.0%) responded that there would be no change. No company selected "significant improvement" or "significant deterioration."

The nearly equal proportion of companies expecting either deterioration or improvement is seen as a direct reflection of the uncertainty felt within the business community. One corporate representative confessed, "It feels like a major obstacle is approaching."

When asked to describe the greatest management burdens in their own words, companies cited "economic slowdown," "global economic downturn," and "uncertainty about business recovery." This indicates that domestic market stagnation, declining overseas demand, and business volatility are simultaneously placing pressure on corporate outlooks.

Trade and tariff risks also emerged as major variables. Thirteen companies (27.7%) identified global trade and tariff risks as the biggest management burden after regulatory uncertainty. The United States' restrictions on semiconductor equipment exports to China, the strengthening of protectionism, and the restructuring of supply chains among major countries have already become tangible pressures. When asked about the most urgent tasks the government should address within the next six months, eight companies (17.0%) chose trade and tariff responses and supply chain stabilization.

Upcoming policy schedules are also cited as factors increasing corporate uncertainty. At the recently convened regular National Assembly session, follow-up discussions on the labor union law (Yellow Envelope Law), amendments to the Commercial Act enforcement ordinance, and the ESG disclosure obligation roadmap are set to be key agenda items. In the environmental sector, detailed standards for the fourth phase of the emissions trading scheme will be announced in the second half of this year, and ESG disclosures will be gradually applied to listed companies with assets exceeding 2 trillion won starting in 2026.

Experts point out that the government's response to risks will determine the economic trajectory over the next year. Externally, tariffs and supply chains, and internally, regulatory and legislative changes, are simultaneously acting as burdens. Therefore, it is argued that policies must ensure predictability and effectiveness, rather than tightening constraints on businesses, to prevent contractions in investment and employment.

On September 2, President Lee Jaemyung emphasized balance at a cabinet meeting by stating, "A bird flies with two wings. Both business and labor are important." Two days later, he met with union leaders and mentioned the need for greater labor market flexibility, signaling an effort to strike a balance.

An industrial policy expert from a major economic organization, speaking on condition of anonymity, said, "According to companies, tariff issues remain unresolved, and those in advanced industries face restrictions on importing equipment from the United States. Externally, export routes are blocked, and internally, sluggish domestic demand is making things difficult overall." He added, "Labor union law and judicial risks may not be immediately apparent, but they are heavy concerns. The economy is driven by sentiment, and with such an unclear outlook, it is difficult for companies to proactively increase investment."

An executive at a major conglomerate commented, "At the beginning of the administration, it seemed the government was empowering businesses by working together with company leaders, but recent legislative developments feel like a setback from the corporate perspective." He continued, "The Yellow Envelope Law and amendments to the Commercial Act, even with grace periods, act as demotivating factors for companies. While there are policies supporting AI and new industries, the creation of an environment that companies can truly feel remains insufficient. On-site, the business-friendly environment is only at about 20 to 30 out of 100."