Lee Myung-Bak, in a press conference setting out policy goals, also vowed to revive his own country's economy by wooing investment and cutting red tape, saying he believes six percent growth is possible this year.

The former construction CEO will be the country's first president from a business background but his transition is overshadowed by a criminal inquiry into fraud allegations.

He indicated he expects to be cleared of any wrongdoing.

Lee, who has promised a firmer line with the nuclear-armed North, said he is willing to meet its leader Kim Jong-Il after taking office on February 25.

"The leaders of the two Koreas can meet any time they believe it will help North Korea abandon its nuclear weapons and will also help both Koreas," he said, adding that any future summit should be held in the South.

The previous two summits, in 2000 and last October, were held in Pyongyang. Lee said he would review sweeping economic joint projects announced last October.

"My new government will study the implementation of the agreements from the perspective of feasibility, fiscal burdens on the people and the national consensus," he said.

He offered the impoverished North major economic cooperation if it honours an international pledge to scrap its nuclear programmes.

"If they sincerely fulfil the agreements reached at the six-party talks, we can advance the era of full-scale inter-Korean cooperation," Lee said.

He promised to strengthen Seoul's alliance with the United States and said this would also help the North reconcile with its traditional enemy Washington.

The North missed a year-end deadline to disable its main atomic plants and declare all its nuclear programmes under a six-nation pact, according to its negotiating partners.

Pyongyang says it declared its nuclear programmes to the United States in November, and accuses its partners of not keeping their side of the bargain.

Lee last month won the biggest victory margin in the country's democratic history with pledges to boost growth and create jobs through a business-friendly approach.

Victory came despite a parliamentary vote for an independent counsel to probe his alleged links to a 2001 share manipulation scandal. State prosecutors had earlier cleared Lee of involvement.

"The prosecution has already conducted a thorough investigation and questioned those involved," Lee said. "I expect the independent counsel also to do a fair and good job."

The counsel is expected to report around February 17. As president, Lee would be immune from prosecution except for treason.

Lee pledges to raise annual growth to seven percent during his five-year term. The central bank said last month it expects gross domestic product to expand by 4.7 percent in 2008 compared to 4.8 percent estimated for 2007.

"Achieving a seven percent growth rate this year might be difficult, but I believe that achieving six percent is feasible by actively inducing investments and increasing the number of jobs," he said.

"I will not promote irrational measures that will cause excessive budget spending."

His administration "will focus on deregulation as well as downsized government. Regulations which hamper investment should be removed first."

Lee promised a "slim and efficient government" after five years in which the number of government officials has risen by 56,000.

"To build a frugal and capable government is the most important political task for the Lee Myung-Bak administration."

Another keynote campaign pledge, a 16-billion-dollar cross-country canal project, would be a "100 percent private investment project," he promised.

All rights reserved. © 2005 Agence France-Presse. Sections of the information displayed on this page (dispatches, photographs, logos) are protected by intellectual property rights owned by Agence France-Presse. As a consequence, you may not copy, reproduce, modify, transmit, publish, display or in any way commercially exploit any of the content of this section without the prior written consent of Agence France-Presse.