President Lee Jae-myung responds to questions from attendees during an on-site roundtable discussion on eradicating unfair practices in the stock market, held at the Korea Exchange in Yeongdeungpo District, Seoul, on June 11, 2025.(Photo by the Presidential Office Press Corps)
SEOUL, June 11 (Korea Bizwire) — President Lee Jae-myung on Wednesday unveiled a sweeping vision to revitalize South Korea’s capital markets by promoting dividend-friendly policies, cracking down on unfair trading practices, and positioning equities as a viable alternative to real estate for household investment.
Speaking at a roundtable held at the Korea Exchange’s Market Surveillance Committee in Yeongdeungpo, President Lee said, “If Koreans can receive interim dividends and even earn living expenses from stock investments, like they do in other countries, it would not only facilitate corporate capital-raising but also stimulate the entire economy.”
Lee noted that South Korean firms have historically shied away from shareholder payouts, contributing to a lackluster investment culture. To change that, he said his administration is preparing both tax and regulatory reforms to encourage more robust dividend practices.
One such proposal, introduced by Democratic Party lawmaker Lee So-young, would apply preferential tax rates to dividends from listed companies with payout ratios of 35% or higher.
While stopping short of endorsing across-the-board cuts to dividend income tax, President Lee expressed openness to lowering rates for companies with responsible payout policies, provided the fiscal impact remains manageable.
The president also addressed the chronic undervaluation of Korean stocks, citing concerns over corporate governance practices such as spin-offs and opaque mergers that have diluted shareholder value.
“What once were solid, promising shares can suddenly become hollow shells,” he said, adding that he now finds it difficult to recommend Korean stocks to others. “We need to fundamentally reform the market so it’s truly investable over the long term.”
President Lee Jae-myung presides over an on-site roundtable on eradicating unfair practices in the stock market, held at the Korea Exchange in Yeongdeungpo District, Seoul, on June 11, 2025. (Photo by the Presidential Office Press Corps)
In line with these concerns, President Lee emphasized the importance of the Korea Exchange’s Market Surveillance Committee in combating unfair trading. He called for enhanced monitoring systems, rapid response capabilities, and a possible expansion of staff to keep pace with increasingly sophisticated market manipulation tactics.
Presidential spokesperson Kang Yu-jung added that the new administration is considering a “one-strike-out” policy for securities fraud, which would impose harsh penalties and full clawbacks of illicit gains from perpetrators of stock manipulation and other market abuses.
President Lee concluded by urging exchange officials to contribute ideas — big or small — to support his goal of ushering in a new era for Korean equities. “Let’s open the door to a KOSPI 5000 era,” he said, referencing his ambition to see South Korea’s benchmark index reach new historic highs.
The remarks underscore the administration’s broader agenda to restore investor confidence, enhance corporate transparency, and position equity markets as a cornerstone of household wealth building by 2026.
M. H. Lee (mhlee@koreabizwire.com)
