61 year old Park faces major challenges being the leader of one of the largest economies. The biggest challenge in front of her is the 'belligerent regime in the North, a slowing economy and soaring welfare costs in one of the world's most rapidly ageing societies'.
Calling for North Korea to abandon its nuclear ambitions and rejoin the international community, Park said, "North Korea's recent nuclear test is a challenge to the survival and future of the Korean people, and there should be no mistake that the biggest victim will be none other than North Korea itself."
"I will not tolerate any action that threatens the lives of our people and the security of our nation," Park said adding, "I will move forward step-by-step on the basis of credible deterrence."
Most of the Park's inaugural speech focused on the 'economy, and included commitments to job creation, expanded welfare and "economic democratisation" at a time of growing concern with income and wealth disparity'.
In a clear warning to the giant, family-run conglomerates, or "chaebols," that dominate the national economy, Park promised a more level-playing field and a "fair market" where small and medium-sized businesses could flourish.
"By rooting out various unfair practices and rectifying the misguided habits of the past which have frustrated small business owners... we will provide active support to ensure that everyone can live up to their fullest potential," she said.
As South Korea's first-ever female president, Park will lead a country that is ranked below the likes of Suriname and the United Arab Emirates in gender equality.
South Korea's journey from war-torn poverty to Asia's fourth-largest economy has done little to break the male stranglehold on political and commercial power in what in many ways remains a very conservative nation.
The two and a half hour inauguration included a 21-gun salute and a performance from Korean rapper Psy of his song "Gangnam Style" -- the global hit of 2012.
(With inputs from AFP)