South Korean President Roh Moo-hyun apologised on Wednesday for a political funding scandal that has embroiled close aides, but declined to address his own role in the case until a prosecution investigation is completed.
In an address before a New Year's news conference, Roh also gave a surprisingly cautious assessment of where Asia's fourth-largest economy is headed this year.
Roh called for perseverance in the quest to end North Korea's nuclear ambitions and said a US unofficial visit to the communist state last week would help dialogue succeed.
"It's important to be patient. It is important not to shake the stable basis of the process," he said, referring to painstaking diplomatic efforts to coax North Korea to scrap a programme that is believe to have already built two atomic bombs.
Roh said the economy was showing signs of a turnaround in investment and consumption, but a slow pick-up was inevitable as long as consumers were under pressure to pay debts - including to stretched credit card companies.
The president, a former labour lawyer, urged unions to refrain from demanding excessive wage increases. Foreign investors view incessant labour strife as one of the main problems of doing business in South Korea.
"Without stable labour-management relations, it will be difficult for us to achieve the goals of improving competitiveness and creating jobs," Roh said.
His comments appeared more cautious than recent optimistic-sounding government noises on the economy, notably that the global economic recovery appeared stronger than expectations and export growth could have another brisk year.
The funding scandal involved millions of dollars of under-the-table donations from the country's "chaebol" business conglomerates.
Prosecutors indicted eight aides and donors last month for their part in illegal fundraising during the December 2002 election in which Roh defeated conservative opposition chief Lee Hoi-chang.
"The illegal presidential election fundraising and the misdeeds of those around me have disappointed everyone," Roh said. "I again extend my apology."
Such apologies are not new in South Korea. Several past presidents have been jailed or forced to apologise for corruption in office. But Roh's dilemma is greater because he has staked his reputation and his presidency on cleaning up politics.
Besides the aides, eight members of parliament were arrested over a scandal that has not only rocked Roh's government but also embarrassed the opposition ahead of parliamentary polls in April.
Yet Roh appeared to back away from his aim of holding a referendum on his rule, saying it would be difficult to organise such a separate vote and also tricky to tie a confidence poll to the April 15 parliamentary election.
The scandal broke in October, prompting the opposition-controlled parliament to set up a special counsel to investigate three Roh aides who have been implicated in illegal fundraising and other charges.
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