Lee Jae-myung vows dividend boost, transparency in capital market
President Lee Jae-myung on Wednesday pledged to map out various incentives for listed companies on South Korean stock markets to pay out more dividends, saying the stock market could play a key role in boosting the national economy.
"In other countries, people buy blue-chip stocks and use the dividends paid from them to supplement their living expenses, which boosts domestic consumption and contributes to a virtuous cycle in the economy, but (companies in) our country are not willing to pay dividends," said Lee during a meeting with representatives of the Korea Exchange, South Korea's main stock market operator, which is also tasked with market oversight.
President Lee also said South Korean stocks tend to lag behind in dividend payments compared to other countries such as China.
"There must be various reasons for that. So we are preparing for tax code reforms and policy improvements to boost dividends," Lee said.
"If equities become an alternative destination that people find as attractive as real estate, then by allowing people to get more dividends and make money to cover living costs, companies will find it easier to attract capital, and a virtuous cycle will be created," he also said.
The remarks came as South Korea's stock market hit a three-year high, extending a winning streak that started with his inauguration the previous week.
Lee, who took office on June 4, also said restoring transparency in South Korea's capital market was his priority.
Meeting the KRX representatives, including 55 rank-and-file employees of the bourse operator, Lee stressed the need for stronger market monitoring to tackle unfair trading practices -- namely, insider trading, market manipulation and market disruption.
"At the core of a capitalist economy lies the stock market," Lee said. "The most important task is to resolve, or at least alleviate, the unfairness and opacity of the stock market."
Later in the afternoon, Lee's spokesperson elaborated on the president's remarks that the government would respond firmly to unfair trading by implementing a "one strike, you're out" policy for acts such as stock manipulation. The government would seek measures to recover illicit gains through fines equal to the profits obtained,' his spokesperson Kang Yu-jung told reporters.
During his presidential election campaign, Lee pledged to improve market liquidity for stock investors and come up with measures to better distribute profits to shareholders.
Lee, the former leader of what was then the main opposition party, has also called for a legal revision to require boardrooms at South Korean companies to fulfill their fiduciary duty not only to their companies but also to their shareholders.
The Kospi -- South Korea's benchmark stock index -- hit its highest point in about three years and five months, continuing its winning streak for a fifth consecutive trading day since Lee's inauguration on June 4. The market did not operate on Friday due to the observance of National Memorial Day.
At 3 p.m. Wednesday, the Kospi stood at 2,903.10 points, up more than 1 percent from the previous day's close. Over the first week of Lee's presidency, the index had risen nearly 8 percent.
Foreign investor net inflows also continued for the past five trading days, including net purchases of 93.2 billion won ($68 million) on Wednesday as of around 3 p.m.
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Korea Herald
3 minutes ago
- Korea Herald
Church, far-right pastor raided over Jan. court attack
Controversial pastor accused of inciting mob attack on court that issued arrest warrant for Yoon Suk Yeol South Korean police on Tuesday conducted a search and seizure operation at Sarang Jeil Church as part of a criminal investigation into pastor Jeon Kwang-hoon, who is affiliated with the church and is suspected of inciting an assault earlier this year on a court that issued an arrest warrant for then-President Yoon Suk Yeol. The Seoul Metropolitan Police Agency said that the church, located in Seongbuk-gu, northern Seoul, was raided at around 6:30 a.m., with officers searching the entire building. The search relates to suspicions that Jeon, an outspoken supporter of former President Yoon Suk Yeol, incited his followers to attack the Seoul Western District Court on Jan. 19. Since the incident, authorities have been investigating individuals connected to Jeon, including "special missionaries" of the church, some of whom were sentenced to prison on Friday for their roles in the attack. A total of 143 people have been arrested in relation to the attack that injured 97 people, and 49 have been convicted of related charges. Jeon, 71, has long been at the center of controversy for politically incendiary commentary that often included false claims. One such comment involved a suicide attempt by a man thought to be a Yoon supporter in January, about which he said, "This is not the time. I'll give you a chance to die effectively." One church missionary involved in the court attack posted a video message on Jan. 15, urging Jeon's followers to "carry out Jeon's orders," which was widely seen as inciting some form of violence. The assault on the Seoul court was conducted by supporters of Yoon protesting the court's issuance of an arrest warrant for the then-president, who was suspected of leading an insurrection by declaring martial law in December. Yoon's declaration of martial law on Dec. 3 lasted only a few hours before it was revoked by parliament in a vote, and his impeachment was confirmed by the Constitutional Court in April. Jeon's alleged role in court attack Jeon has denied the accusation that he orchestrated the court attack, but said in a Jan. 19 rally -- a few hours after the attack -- that the "people's right to resist has begun," and that such a right is above the Constitution. He has also publicly said that Yoon should be reinstated as president to "overhaul the entire country." Shortly before the court attack, Jeon said at a protest that his followers should "gather at the Seoul Western District Court and exercise the right of resistance to prevent the president's arrest warrant," which the Democratic Party said amounted to incitement to use collective force to neutralize the court. In February, the Democratic Party of Korea -- then the main opposition -- filed criminal charges against Jeon, accusing him of promoting insurrection and inciting a riot. It claimed that Jeon and other individuals on the far right had tried to justify Yoon's illegal imposition of martial law and instigated violence that caused social chaos. Exactly how much influence Jeon has over the Sarang Jeil Church is unclear, since he stepped down as senior pastor in 2024 at the church he founded in 1983. While his official post is senior advisor, it is widely believed that he is not only a prominent member of the church, but may be its de facto leader. He has indicated that he still holds a significant position at the church, in comments such as a February remark that he is not "at a level where he would (personally) speak to the special missionaries' -- referring to the members of the Sarang Jeil Church who participated in the court attack.
Korea Herald
2 hours ago
- Korea Herald
Seoul shares open sharply higher on US gains
South Korean stocks opened sharply higher Tuesday, tracking overnight gains on Wall Street driven by hopes for rate cuts. The benchmark Korea Composite Stock Price Index rose 59.1 points, or 1.88 percent, to 3,206.85 in the first 15 minutes of trading. Overnight, US stocks gained ground on hopes the Federal Reserve may go for multiple rate cuts later this year to support the economy following a weaker-than-expected jobs report released over the weekend. The Dow Jones Industrial Average closed 1.34 percent higher, with the tech-heavy Nasdaq composite climbing 1.95 percent and the S&P 500 rising 1.47 percent. In Seoul, big-cap shares got off to a strong start as investors went bargain hunting following the KOSPI's steep drop last week. Market bellwether Samsung Electronics added 1.72 percent, while its chipmaking rival SK hynix gained 1.94 percent. Leading battery maker LG Energy Solution jumped 2.13 percent, and top automaker Hyundai Motor advanced 1.18 percent. Financial and shipbuilding shares were particularly bullish. KB Financial soared 3.69 percent, and Shinhan Financial spiked 3.19 percent. Major shipbuilder HD Hyundai Heavy surged 2.27 percent, and HD Korea Shipbuilding shot up 4.15 percent. The state-run Korea Electric Power also increased 2.28 percent. But Kakao, the operator of the country's dominant mobile messenger, slid 3.25 percent. The local currency was trading at 1,382.8 won against the greenback at 9:15 a.m., up 2.4 won from the previous session. (Yonhap)
Korea Herald
3 hours ago
- Korea Herald
Consumer prices rise 2.1% in July on higher industrial goods, service costs
South Korea's consumer prices grew by more than 2 percent for the second consecutive month in July, mainly driven by higher costs of industrial goods and services, government data showed Tuesday. Consumer prices, a key gauge of inflation, increased 2.1 percent from a year earlier last month, according to the data from Statistics Korea. Inflation had remained above the Bank of Korea's 2 percent target for four consecutive months through April before slowing to 1.9 percent in May. It then edged up to 2.2 percent in June. The statistics agency said the July gain was mainly due to the continued depreciation of the South Korean won, which pushed up import prices for industrial goods. A steady increase in service prices also added to inflationary pressure. Among industrial goods, prices of processed food products jumped 4.1 percent on-year, adding 0.35 percentage point to July's overall inflation. While agricultural product prices inched down 0.1 percent from a year earlier, prices of livestock and fisheries products rose 3.5 percent and 7.3 percent, respectively. In contrast, petroleum product prices fell 1 percent on-year, reversing an increase in the previous month. The service sector continued its upward trend, posting a 2.3 percent on-year gain. Within the sector, utility costs, such as electricity and gas, increased 1.6 percent, while water charges advanced 2.7 percent. Among personal services, prices for dining out rose 3.2 percent from a year earlier, and non-dining services climbed 3.5 percent. Core inflation, which excludes volatile food and energy prices, went up 2 percent in July, matching the previous month's increase. (Yonhap)
