Yoon Speaks on Short Selling Measures: "If Neglected, Trust Declines and Investors Withdraw... Ban Until Improvement Plan Is Made" (Comprehensive)

President Yoon Chairs Cabinet Meeting... First Statement Since Government's Short-Selling Ban
"Difficult to Form Fair Prices... Fundamental Improvements Needed to Prevent Further Damage"
Reflecting on Public Welfare Efforts, "Policies Must Be Properly Implemented and Felt by the People"
Urges National Assembly to Pass Stalled Local Commercial Act and Fair Hiring Act for Public Welfare

President Yoon Suk-yeol emphasized on the 14th regarding the ban on short selling, stating, "Neglecting illegal short selling leads to a decline in trust in the securities market and causes investors to withdraw," and added, "In the long term, this is a path that positively impacts the competitiveness of our securities market." This was President Yoon's first official stance following the financial authorities' announcement, interpreted as a direct effort to calm market instability factors such as the outflow of foreign capital.

On the same day, President Yoon presided over a Cabinet meeting at the Yongsan Presidential Office, stating, "Illegal short selling makes fair price formation difficult and causes significant losses to individual investors," and "To prevent further damage, short selling will be banned until fundamental improvement measures are devised." His remarks came a week after the government announced a temporary full ban on short selling. Amid ongoing debates about the decision's background and side effects, this appears to be presidential support following additional measures by financial authorities.

President Yoon Suk-yeol is speaking at the Cabinet meeting held on the 14th at the Presidential Office building in Yongsan, Seoul.
[Photo by Yonhap News]

President Yoon also said, "Since last week, short selling has been temporarily banned to prevent illegal market disruption and to protect our stock market and 14 million individual investors," and revealed, "Some have expressed concerns that this short selling ban might hinder inclusion in the MSCI (Morgan Stanley Capital International) developed markets index." However, President Yoon noted, "Unlike the United States, our securities market is highly volatile and has a high proportion of individual investors," signaling that the ban will continue until the government establishes fundamental improvement plans. He then instructed the financial authorities to "prepare proper solutions to correct the tilted playing field in our securities market and protect individual investors."

President Yoon also shared his views on the 292 livelihood sites visited by the Presidential Office and various ministries following his state visits to Saudi Arabia and Qatar last month. He stated, "While it is important to create policies for livelihoods, those policies must be properly implemented on the ground and felt by the people," adding, "Hearing the earnest voices of the people directly has strengthened my resolve to address problems more actively and swiftly."

In particular, he mentioned, "Although the 'Delivery Payment Linkage System' implemented last October has created conditions for small and medium-sized enterprises (SMEs) to receive fair payment for deliveries, the financial situation of SMEs and small business owners, worsened by recent high interest rates, is not improving easily," and urged, "To alleviate the financial difficulties of SMEs that depend on large and mid-sized companies for 75% of their sales, the government should actively persuade all primary contractors to participate in the 'Delivery Payment Linkage System.'"

He also called for the swift passage of livelihood-related bills stalled in the National Assembly. Referring to the 'Special Act for the Maintenance of Aging Planned Cities,' President Yoon said, "New towns created in the past to disperse population are aging, causing ongoing issues such as residents' safety, noise between floors, and parking disputes," and emphasized, "To swiftly and orderly renovate large complexes and transform aging cities, which still remain as they were 30 years ago, into future cities, the existing legal framework has limitations," urging prompt enactment.

Addressing difficulties in local economies and commercial districts, he brought up the revision of the 'Local Commercial District Act.' This was based on the assessment that the decline in the working-age population combined with the outflow of young people to the metropolitan area is worsening the management of local small business owners and causing regional economic hollowing. President Yoon said, "It is urgent to rebuild local commercial districts and develop them into distinctive spaces that attract people," and requested, "I ask for special attention to the revision so that the private sector can plan creative development strategies and local governments can support them with a 'Local Commercial District Development Fund.'"

He also stressed the necessity of implementing the 'Fair Recruitment Act.' President Yoon explained, "Our government promotes a market economy centered on the private sector and enterprises, and my efforts in overseas market development and sales diplomacy aim to create quality jobs for the future generation, the youth," adding, "The prerequisite for these effects to materialize properly is fairness and transparency in the recruitment process."

On the same day, President Yoon welcomed the return of the Korean Federation of Trade Unions to the Economic and Social Labor Council. He said, "Recently, our economy faces great difficulties due to high inflation and high interest rates, compounded by structural problems such as low birthrate, aging, and a dual labor market, threatening sustained growth," and added, "However, if labor, management, and government come together and engage in dialogue, any difficulty can be overcome." He promised, "Labor and management must dialogue and cooperate on the foundation of the rule of law. The government will faithfully perform its role as a fair mediator and bridge."

Meanwhile, through an interview published by the Associated Press on the same day, President Yoon previewed activities during the Asia-Pacific Economic Cooperation (APEC) summit to be held from the 15th to the 17th. President Yoon stated, "At the APEC summit, I will warn other leaders that illegal cooperation between Russia and North Korea poses a serious security threat." He also added that he plans to emphasize that North Korea's attempted military reconnaissance satellites could be a threat as they enhance nuclear delivery capabilities.

He clearly expressed the view that APEC must demonstrate leadership amid unprecedented complex crises. This includes responding to the Ukraine war, the conflict between Israel and the Palestinian armed group Hamas, the climate crisis, establishing digital norms, and strengthening multilateral trade and regional supply chains, with Korea playing an active role as a global pivotal country.

At the Cabinet meeting, President Yoon also introduced, "This APEC summit is held amid a global complex crisis where geopolitical instability and geoeconomic shifts intersect," and explained, "At this meeting where leaders of member countries accounting for over 60% of the world's GDP gather, we will discuss cooperation measures that practically benefit our economy, such as supply chain diversification, trade, and investment expansion."

President Yoon Suk-yeol is speaking at the Cabinet meeting held on the 14th at the Presidential Office building in Yongsan, Seoul.
[Photo by Yonhap News]