By Jack Kim
SEOUL (Reuters) - South Koreans vote for a new president on Wednesday against a backdrop of a hostile North Korea and a slowing economy, in a battle between the daughter of a former military ruler and a man her father jailed decades ago for political activism.
Conservative candidate Park Geun-hye had a narrow lead in polls published last week, the last allowed under election rules, and if she wins, she would be the first woman leader of the country which is still largely run by men in dark suits.
The 60-year-old daughter of Park Chung-hee has pledged dialogue with isolated, impoverished North Korea, whose rocket launch last week reinforced fears it is developing a long-range missile, while promising a tough position on its nuclear and missile programmes.
Her left-of-center challenger, Moon Jae-in, is a former human rights lawyer who has promised unconditional aid for North Korea and to reintroduce an engagement policy that ushered in closer ties between the Cold War rivals.
Those ties started unraveling with the shooting by North Korea of a tourist from the South in 2008, and deteriorated with the sinking of a South Korean warship in 2010, something the North denies, and the shelling of a South Korean island later that year.
More than 40 million people are eligible to vote.
The polls open at 6 a.m. (2100 GMT) and close at 6 p.m. (0900 GMT), when the three network television stations will announce the result of a jointly conducted exit poll.
Most analysts forecast a tight race between the two front-runners who were separated by as little as 0.5 percentage points in some polls, with Moon making late gains on Park.
While Park's bid to become president has stirred debate and divisions about her father's rule, and the prospect of a nuclear armed North Korea's hangs over the country, the main issues in the election has been the economy.
IT'S THE ECONOMY, NOT NORTH KOREA
While outwardly successful and home to some of the world's biggest companies such as Samsung Electronics Co Ltd and Hyundai Motor Co, South Korean society has become steadily more unequal.
The hundreds of thousands of graduates that its universities churn out each year complain they have trouble finding decent jobs and while South Korea is now the 29th richest country in the world in terms of gross domestic product per capita, income differentials have widened sharply.
Park has proposed more social welfare under what she terms a policy of "economic democratization" but has spelled out few specifics. Her party says it will not spend more money to boost the economy.
Park, who has never married nor had children, has advocated a broader welfare policy than when she ran five years ago, when she failed to win the conservative presidential nomination, and has proposed paying for it by cutting wasteful spending.
Moon, by contrast, has proposed an $18 billion jobs package, boosting maternity pay and taxing the super-rich. He has also pledged to repeal a controversial free trade agreement with the United States.
While North Korea was the main issue for just 4.7 percent of voters, according to a poll by broadcaster SBS taken last week, the 18-year rule of Park's father still divides Koreans and will be on the minds of many of those voting.
The elder Park took power in a 1961 coup and helped push South Korea from poverty to developed nation status but at the cost of repressing human rights and democracy.
His wife was shot by a North Korean-backed assassin who was gunning for him in 1974 and his then young daughter took on the role of South Korea's first lady until Park's own killing in 1979 by his security chief after a drunken night out.
Park has at times sought to appeal to the spirit that her father embodied and on Tuesday evoked his economic call to arms of "Let's Live well" in a bid to rally her party faithful.
But at other times she has stumbled over apologies to victims of her father's rule and sought to appeal to her mother's softer image.
Moon, jailed in 1975 when he was a student activist, has attacked Park for being at the "heart" of South Korea's dictatorship and "for living the life of a princess".
Moon's only political experience was as an aide to former President Roh Moo-hyun, who was his law partner and held office until 2008.
(Editing by David Chance and Robert Birsel)