JOIN USPresidential secretary for public relations Hong Sang-pyo announced that the shake-up also included the ministers of education, knowledge economy and five other departments. It did not affect the key ministries of foreign affairs, defense or unification.
Kim Tae-ho, a former governor of South Gyeongsang province, was nominated to replace Chung Un-chan as prime minister, Hong said. The appointment is subject to parliamentary approval.
The prime minister is the nation's second-highest official, but is largely a ceremonial position with little decision-making power. The shake-up came in response to public demands for reform, the presidential office said in a statement.
Lee's ruling party suffered a surprise defeat in mayoral and gubernatorial elections in June, though it won parliamentary by-elections in July. The elections were considered a gauge of public support for Lee's conservative government.
South Korean presidents often use personnel appointments to regain public confidence. Kim, 47, said he would seek national reconciliation and enhance communication with the people.
South Korea has been divided over a plan to move more than half of the 15 government ministries out of the capital to a nearby city. Chung, the outgoing prime minister, led the charge to abandon the project. President Lee Myung-bak has said the plan would waste taxpayer money and create inefficiencies.
The National Assembly rejected Lee's push in June, forcing him to start work on implementing the original plan, which proponents say would foster regional development and help solve Seoul's worsening traffic and housing problems.
Lee also replaced the ministers of culture, agriculture, health and welfare, employment and labor, and a special minister handling political affairs. The reshuffle came amid tension with North Korea over large South Korean naval drills off the west coast, including areas near the two countries' disputed sea border.
The exercises, which end Monday, were aimed at strengthening South Korea's ability to counter any North Korean provocations following the March sinking of a South Korean warship that killed 46 sailors.