Kim Minseok: "President Lee Said We Must Focus on KOSDAQ... Will Discuss 'Separation Plan' from KOSPI"

Interpellation on Economic Affairs at the National Assembly

Prime Minister Kim Minseok said on the 10th that President Lee Jaemyung, as the era of KOSPI 5000 has fully begun, emphasized the position that "now we need to pay attention to the KOSDAQ market." He also mentioned that the government would discuss the bill submitted to the National Assembly to separate KOSDAQ, which is effectively treated as a second division, from KOSPI and operate it as an independent market.

At the afternoon interpellation session on economic affairs held at the National Assembly in Yeouido that day, Prime Minister Kim responded to Democratic Party lawmaker Kim Taenyeon’s remark that "KOSDAQ is not fully performing its role as an innovation market" by saying, "The Presidential Office, with the policy chief at the center, is also considering improvement measures."

He acknowledged the problems of the KOSDAQ market, saying, "KOSPI is improving considerably as policy and sentiment, among other factors, are coming together, but compared to that, KOSDAQ is dormant," and "Fundamentally, many factors such as corporate fundamentals and insolvency are at work." He added, "I personally heard the President say that, given the improvement in KOSPI, it is now time to pay attention to KOSDAQ," signaling that a series of measures to revitalize the KOSDAQ market will follow. The financial authorities had also released measures to revitalize the KOSDAQ market, including strengthening delisting requirements, in December last year.

Modeled after the U.S. NASDAQ, KOSDAQ now has nearly 2,000 listed companies, but accounts for only 14% of total market capitalization. Lawmaker Kim, who previously submitted a bill to separate the KOSPI and KOSDAQ markets, pointed out, "NASDAQ is an independent market, but KOSDAQ is incorporated into the exchange," adding, "KOSDAQ has become like a second division of KOSPI, so institutional investment is weak and individuals only cling to short-term trading. The structure needs to be changed." He went on to introduce the bill he sponsored, saying, "Wouldn’t separating and making KOSPI and KOSDAQ independent be the most innovative measure?"

In response, Prime Minister Kim said, "I have reviewed the bill," and added, "At the government level, we take seriously the issues you have raised and are seeking to consult with the National Assembly." He had also responded at the previous day’s interpellation session, when asked about the need for separate operation, by saying, "We will make a comprehensive judgment," and "It would be good to devise measures and legislate them."