Lee Jae-myung, "100% Support for Investigation" on 'Daejang-dong Favoritism Allegations'

Lee Jae-myung "Private investment project participants cannot be involved in profit distribution... Isn't that 'common sense'?"

Gyeonggi Province Governor Lee Jae-myung is holding a press conference on the 14th at the National Assembly Communication Office regarding the allegations related to the 'Seongnam City Daejang District Development Project.' [Image source=Yonhap News]

[Asia Economy Reporter Kim Seohyun] Lee Jae-myung, the Democratic Party presidential pre-candidate and Governor of Gyeonggi Province, denied allegations of preferential treatment surrounding the public-private joint development of the Daejang District in Seongnam City and agreed to a reinvestigation.

On the 15th, Lee attended the Gyeonggi Provincial Council plenary session and stated, "(People Power Party council members) are telling me to resign and to investigate, and I 100% agree to the investigation."

He began by saying, "When I entered the plenary hall, People Power Party members officially made several remarks, so out of courtesy, I will say a little," and emphasized once again, "As far as I know, investigations have already been conducted several times. If a reinvestigation is requested, I am 100% in favor."

He continued, "The Daejang-dong development is a project with many vested interests and high profits. Initially, it was being handled by the Korea Land and Housing Corporation (LH). Shin, a former member of the Saenuri Party, the predecessor of the People Power Party, pressured the LH president during a national audit to give up, and eventually, LH gave up, making private development possible," and explained, "However, contrary to expectations, after I was elected as the mayor of Seongnam, I decided on public development."

He added, "At that time, many People Power Party city council members strongly opposed it, but we established the Seongnam Urban Development Corporation as the project entity and set a condition to guarantee Seongnam City a minimum net profit of 500 billion KRW," emphasizing, "The contract terms are clear. Whether there is a loss or profit, the city does not intervene. All costs, risks, and losses are borne by the private consortium participants. Seongnam City only exercised its licensing authority."

Regarding the high profits earned by the private Asset Management Company (AMC) participating in the consortium, he explained, "During the project, land prices rose significantly, resulting in an additional burden of 92 billion KRW, which conversely reduced the private business operator's profits by that amount." He continued, "Since they handle all the business and we secure profits most safely without bearing any risks, there is no need to, nor should we, interfere with how those who participate in private investment projects distribute profits or whether they incur losses or gains. Isn't that common sense?"

Earlier, six People Power Party members of the Gyeonggi Provincial Council held a press conference that morning, stating, "We can no longer recognize Lee, who is obsessed with the vain desire to become president, misleading public opinion and deceiving the people, as a leader," and demanded, "Immediately investigate the preferential treatment allegations related to Hwacheon Daeyu, the AMC of the Daejang District development project."