South Korea’s President Lee Jae Myung on Tuesday proposed legislation to formally establish a social and solidarity economy framework. The initiative aims to reduce inequality by ensuring economic growth benefits a broader range of stakeholders.
Speaking at a Cabinet meeting in Sejong, Lee said the country must move beyond growth driven solely by large corporations. He argued that equitable and sustainable development should guide future economic policy.
Interior Minister Yun Ho-jung briefed Cabinet members on plans to enact a law defining the social and solidarity economy. The proposal would provide legal support for cooperatives, social enterprises, and community-based organizations.
The legislation forms part of the Lee administration’s five-year policy blueprint, which outlines 123 national objectives. Officials described the social economy as a central pillar of the government’s reform agenda.
Lee said South Korea’s rapid growth over past decades has increased economic output but widened income gaps. Therefore, he called for policies that emphasize shared prosperity rather than purely quantitative expansion.
During the meeting, officials presented examples of cooperative profit-sharing in public-sector projects. These cases illustrated how community participation could strengthen local economies.
In South Jeolla Province’s Sinan County, residents involved in a solar energy project receive profit distributions. The model allows local participants to share financial returns from renewable energy development.
Another example involved a cooperative of street cleaners who also hold ownership stakes. Officials said the structure improved accountability and service quality.
Lee suggested delegating certain public services to cooperatives instead of individual contractors. He said such arrangements could align worker incentives with public interests.
Government officials stressed that rapid legislative action would prove critical to expanding these models nationwide. Legal clarity, they said, would encourage broader participation and investment.
Experts noted that similar social economy frameworks operate in several advanced economies. They added that cooperative models often support renewable energy, public services, and local development.
Analysts also said South Korea’s reliance on large conglomerates has limited grassroots economic participation. Consequently, the proposed framework could diversify growth drivers.
Lee framed the initiative as both an economic reform and a social investment. He said inclusive growth would strengthen social cohesion during global economic uncertainty.
The government plans to consult local governments and private stakeholders before submitting the bill to parliament. Lawmakers are expected to debate the proposal in coming months.
If approved, the legislation would mark a significant shift in South Korea’s economic governance. The administration says it would promote fairness without undermining competitiveness.
