South Korea formally divided its Ministry of Economy and Finance into two entities on January 2, 2026, following anticipation of a potentially leaderless launch. The new Ministry of Planning and Budget, under the Prime Minister's Office, now handles budget functions, with former lawmaker Lee Hye-hoon nominated as its head.
The division, part of a broader government reorganization under President Lee Jae-myung's reforms, reverses the 2008 merger and aims to improve efficiency, budget transparency, and policy execution amid economic challenges.
At the opening ceremony, Finance Minister Koo Yun-cheol emphasized achieving growth rebounds and economic leaps. Lee Hye-hoon, a former three-term conservative lawmaker, was nominated to lead the new ministry, addressing earlier concerns about a leaderless start.
While expected to streamline operations, some worry about short-term disruptions from the split.
