In his first meeting with the nation’s powerful business leaders since taking office, Lee faced a delicate balancing act, appealing to the economic clout of the chaebols and reassuring them on trade negotiations, while signaling his intent to follow through on campaign pledges to curb their outsized influence in Asia’s fourth-largest economy. 

“Our economy can no longer sustain growth through unfair competition, special privileges for, or exploitation of some actors like it did in the past,” Lee told executives at the gathering, including the chiefs of Samsung Group, SK Group, [hotlink]Hyundai Motor[/hotlink] Group, LG Group and Lotte Group. “There is still some distrust, and I want you to help alleviate it.”

Lee, who defeated his conservative rival to become South Korea’s new president last week, has made economic revitalization one of his top priorities. The country’s chaebols, sprawling family-controlled conglomerates, such as Samsung Electronics Co. and Hyundai Motor Co., have long been a key engine of growth for the economy, giving them broad sway over business and society. 

The new president has pledged to rewrite the commercial code to weed out the rubber-stamping of corporate decisions by directors. The revised code aims to strengthen the duty of company boards to shareholders to improve corporate governance and tackle the so-called Korea discount that has been a long-standing grievance among global investors.

But ahead of his trip to Canada to attend the Group of Seven summit, Lee found many executives at the meeting expressing more immediate concern about the impact of trade protectionism.

“In particular, U.S. tariffs and the uncertainty surrounding the issue have created an unstable environment, making it extremely difficult for businesses to make any decisions or investment,” SK Group Chairman Chey Tae-won said. 

Chey cited the intensifying U.S.-China rivalry among the key risks facing businesses in South Korea, along with weak domestic demand, subdued investment sentiment and an aging population. SK’s semiconductor unit is the world’s leading AI memory chipmaker and a close partner of Nvidia Corp. 

Samsung Electronics Co. Executive Chairman Jay Y. Lee went further, comparing the current environment to the Asian financial crisis of the late 1990s. 

South Korea remains a critical player in global supply chains, producing everything from smartphones and semiconductors to ships and EVs. That makes its economy heavily dependent on trade to power growth with exports equivalent in size to more than 40% of gross domestic product. 

Hyundai Motor, one of the world’s biggest automakers, has pledged to invest $21 billion in the U.S, something Lee can flag to Trump should they meet in Canada. Even so, carmakers may face yet another hike in duties after Trump said Thursday he was considering raising auto tariffs even higher than the recently introduced 25% level to support the industry in the U.S.

With the deadline for imposing reciprocal tariffs approaching early next month, Trump is keen to show progress in reaching deals with key economies that have large trade surpluses with the U.S. 

Talks between Washington and Seoul have been held back by the leadership vacuum and domestic political unrest before Lee’s election win.