On the 4th, Lee Jae-myung visited the exchange: "We must overcome the Korea discount"
Regarding MSCI index inclusion: "Inclusion of advanced country stocks must be achieved swiftly"
Mentioned ISA introduction for youth and long-term investment incentives
[Asia Economy Reporters Oh Ju-yeon and Lee Min-woo] Lee Jae-myung, the presidential candidate of the Democratic Party of Korea, stated on the 4th, "The proportion of real estate in assets is too high, while the stock market is low," adding, "There is potentially much room for the stock market to grow further."
He continued, "It is unfortunate that the asset market, which is a very important means of asset formation for the younger generation, has become a speculative arena due to a lack of experience and knowledge," and promised, "I will try to create policies that expand opportunities for the younger generation to invest in the (stock market)."
Lee Jae-myung, the Democratic Party presidential candidate, is attending a meeting held on the 4th at the Korea Exchange in Yeouido, Seoul, aimed at the development of the stock market and the protection of individual investors. Photo by Yoon Dong-joo doso7@
On the same day, Lee attended a meeting titled 'Stock Market Development and Protection of Individual Investors' held at the Korea Exchange in Yeouido, Seoul, and said, "Capital in our society is particularly concentrated in the real estate market, which I believe causes distortion," adding, "If we normalize the capital market and restore fairness and transparency, a virtuous cycle will emerge in terms of economic revitalization and corporate financing."
Lee pointed out one of the problems of the domestic stock market as the 'Korea Discount.' He said, "The domestic stock market is undervalued, and companies are struggling to raise funds," and noted, "The domestic stock market is still classified as an emerging market, and the inflow of long-term foreign investors is limited, which is a constraint."
Regarding the long-standing issue of inclusion in the MSCI (Morgan Stanley Capital International) Developed Markets Index, Lee did not actively comment but nodded in agreement with a discussant who mentioned the necessity of inclusion and expressed his opinion by saying, "Going forward, the Democratic Party and the government should swiftly adopt developed market systems."
According to materials distributed that day, "Efforts are needed for inclusion in the MSCI Developed Markets Index, which has remained stagnant for seven years," and "In order to enhance international credibility, we must promote inclusion in the MSCI Developed Markets Index." It added, "We should gradually resolve issues such as the internationalization of the Korean won, which has been an obstacle, so that the capital market can be evaluated in line with Korea's economic status." It was explained that inclusion in the developed market index could lead to a net inflow of foreign funds ranging from a minimum of 18 trillion won to a maximum of 62 trillion won.
Lee Jae-myung, the Democratic Party presidential candidate, is attending and speaking at a meeting for the development of the stock market and protection of individual investors held on the 4th at the Korea Exchange in Yeouido, Seoul. Photo by Yoon Dong-joo doso7@
On the other hand, he did not mention short selling, an issue of greatest interest to individual investors.
Inclusion in the MSCI Developed Markets Index inevitably requires a full-scale reopening of short selling due to the expansion of foreign investors. However, domestic individual investors see short selling as a factor that traps the domestic stock market in a box range and are even demanding the abolition of short selling through petitions to the Blue House, making it crucial to see how these conflicting issues will be resolved.
Instead, Lee focused on policies for small shareholders and the activation of the stock market as a means of asset accumulation. Notably, he emphasized viewing the stock market as an opportunity for the younger generation to build assets and pledged to introduce related policies.
Lee said, "While providing labor opportunities is important, I believe it is also essential to provide opportunities for youth in the financial asset market and stock market," adding, "We need to introduce an Individual Savings Account (ISA) for youth." He explained, "Through ISA accounts, we can offer tax benefits or provide investment opportunities in large-scale infrastructure investments I plan to undertake, with the government guaranteeing a certain rate of return to give opportunities to the younger generation." He added, "If opinions are gathered from the field, I hope that, based on the principle of seniority and fairness within a reasonable scope, opportunities will be given to everyone."
He also mentioned incentives for long-term stockholding, saying, "Long-term investment is desirable for everyone." He added, "Capital gains tax on stocks will be introduced soon, and I think benefits should be given for long-term holdings in taxation."
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