President Lee: "Path to Normalizing Capital Markets... Dismantling the Ruinous Real Estate Republic"

According to Financial News, President Lee Jae Myung said on the 26th, "The Republic of Korea (ROK) must move from a Korea discount to a Korea Premium, where our country is valued more highly than any other." He went on, "Just as what once seemed impossible—the normalization of the capital market—has become reality, dismantling the ruinous real estate republic is also not an insurmountable barrier."
Presiding over a senior secretaries’ meeting at Cheong Wa Dae that day, President Lee stated, "In every sphere of our society, the normalization of the state is making gradual progress. The capital market, too, is on the path to normalization."
He noted, "There was a time when our assets were undervalued under the label of a Korea discount, but they are now gradually returning to normal and improving significantly." He stressed, "What our government must do is to restore what is abnormal to normal, and then go beyond normalization to build a better Republic of Korea."
In particular, President Lee assessed that as opaque and irrational elements are gradually corrected, the capital market is emerging from an abnormal state.
He continued, "Yesterday, the National Assembly of the Republic of Korea passed an amendment to the Commercial Act of the Republic of Korea that makes the cancellation of treasury shares mandatory," adding, "If additional institutional reforms, such as a law to prevent stock-price suppression, are put in place, this trend toward normalization will likely grow even stronger." The Korea Composite Stock Price Index (KOSPI), which closed above the 6,000 mark on the 25th, continued its upward trend that day, rising past the 6,300 level.
Drawing a parallel with the recent normalization trend in the capital market, President Lee emphasized that the real estate problem can also be resolved. "In fact, we are seeing a considerable decline in housing prices in Seoul," he said. "Listings of homes for sale are visibly increasing, and the rate of increase in jeonse rental prices is said to be slowing. This is now an irreversible trend, and we must further accelerate a major shift of capital toward productive finance." He added, "We must normalize the abnormal real estate market and move decisively toward an economy that truly improves people’s lives."
The meeting also touched on issues related to North Korea. President Lee said, "Over lunch, I spoke with members of the press, and there were quite a few questions about the latest statement released by North Korea," adding, "The values we must pursue are peace and stability. We must put a definitive end to the past, when we were racing toward confrontation and war."
He particularly remarked, "We must seriously reflect on whether the insults and threats directed at North Korea up to now have truly contributed to peace and stability on the Korean Peninsula, and whether they have been useful in protecting the national interest and security of the Republic of Korea." He continued, "Because a confrontational policy that accepts the risk of war has been pursued, the confrontational mindset and hostile feelings it created cannot disappear overnight. Sustained, corresponding efforts are required."
President Lee went on, "Inter-Korean relations also need to be normalized. To achieve that, we cannot erase the hostility and confrontational mindset that have built up over many years with a single, dramatic measure," adding, "We must build trust through continuous efforts, and as that trust accumulates and deepens, we must move toward a state of mutual understanding and empathy."
He added, "There is an old saying, 'You can’t be full from just one spoonful of rice.' Things do not change in an instant. We must make an effort—by communicating, talking, and working together without ceasing—to build trust little by little and create empathy step by step. If we do so, structural peace and stability will eventually come to the Korean Peninsula."
In addition, President Lee instructed officials at the meeting to respond thoroughly to fraudulent claims on government subsidies by preparing measures for strong financial penalties. "Recently, there has been a growing number of cases where people are caught fraudulently receiving government subsidies," he said. "Not only must all fraudulently obtained subsidies be fully recovered, but we should also consider imposing financial penalties several times that amount. I want us to establish rigorous measures to prevent and punish fraudulent claims so that everyone clearly understands that if you are caught stealing taxpayers’ money, it will ruin you."
cjk@fnnews.com Choi Jong-geun and Sung Seok-woo Reporter