South Korea's new president Park Geun-hye has urged North Korea to abandon its nuclear ambitions.
She called on North Korea to stop wasting its scarce resources on arms, less than two weeks after the country carried out its third nuclear test.
In her inauguration speech, the country's first female president, also called on South Koreans to help revive the nation's export-dependent economy.
South Korea's trade is threatened by neighbouring Japan's weak yen policy.
Ms Park, the 61-year-old daughter of South Korea's former military ruler Park Chung-hee, met with the father of North Korea's current ruler in 2002.
At the meeting she offered the impoverished and isolated neighbour aid and trade if it abandoned its nuclear programme.
Ms Park, usually an austere and demure figure in her public appearances smiled broadly and waved enthusiastically as a 70,000 strong crowd cheered her.
Ms Park's tough stance was supported by the partisan and largely older crowd at her inauguration.
North Korea is ruled by 30-year-old Kim Jong-un, the third of his line to hold power in Pyongyang and the grandson of a man who tried to assassinate Park's father.
The North, which is facing further UN sanctions for its latest nuclear test, which was its biggest and most powerful to date, is unlikely to heed Park's call and there is little Seoul can do to influence its bellicose neighbour.
Ms Park's choices boil down to paying off Pyongyang to abandon its nuclear weapons plan, which would cost hundreds of millions of dollars and failed in 2006 when the North exploded its first nuclear bomb.
Alternatively, Seoul could try to further isolate the North, a move that resulted in the 2010 sinking of a South Korean ship and the shelling of a South Korean island.
Referring to the fast economic growth under her father's rule, which drove war-torn South Korea from poverty to the ranks of the world's richest nations.
Ms Park urged Koreans to re-create the spirit of the "Miracle on the Han".
She wants to create new jobs, in a country where young people often complain of a lack of opportunities, and boost welfare, although she hasn't spelled out how she will do either.
Growth in South Korea has fallen sharply since the days of Ms Park's father who oversaw periods of 10% plus economic expansion.
The Bank of Korea expects the economy to grow just 2.8% this year and 2.8% in 2014.
Ms Park also faces a challenge from a resurgent Japan whose exports have risen sharply after new Prime Minister Shinzo Abe embarked on a policy to weaken the yen currency.
The president last week said she would take "pre-emptive" action on the weak yen, but has yet to specify what action she will take.