Anchor: President Lee Jae-myung has called for stronger measures to deter stock manipulation and other unfair trading practices to build investor confidence in the nation’s stock market. On a visit to South Korea’s KOSPI and KOSDAQ operator Wednesday, Lee also said his administration is working on overhauling the nation’s tax law to boost the stock market.
Kim Bum-soo has more. 

Report: President Lee Jae-myung says he is going to make South Korean stocks a profitable alternative to the nation’s highly speculative real estate market.

Lee disclosed the plan Wednesday at the Korea Exchange, where he discussed ways to vitalize the local stock market with working-level officials at the bourse.

[Sound bite: President Lee Jae-myung (Korean-English)]
“If we can make stocks an alternative investment vehicle, comparable to real estate, so that people can invest in stocks and receive a medium-term dividend and earn a living, it will be easier for companies to raise capital, and the entire South Korean economy will experience a virtuous cycle. At the center of this is the South Korean bourse.”

The president pointed to the fact that many controlling shareholders in South Korea are often reluctant for companies to pay dividends in the country’s chaebol-dominated stock market. 

[Sound bite: President Lee Jae-myung (Korean-English)]
“Investors in other countries buy blue chip stocks and receive interim dividends to cover their living expenses, help domestic demand and create a virtuous economic cycle, but South Korean [companies] don’t pay dividends. There are various reasons. So we are preparing to reform the tax system, or reorganize the system, to promote dividends. Whether it is better to lower dividend income tax unconditionally, I don’t know ...”
 
This reluctance is commonly attributed to high rates of income tax on dividend payments and the controlling shareholders’ focus on maintaining management control.

One of Lee’s key campaign pledges was to boost the benchmark Korea Composite Stock Price Index, or KOSPI, to the five-thousand mark.

To accomplish that, presidential spokesperson Kang Yu-jung told reporters that Lee instructed the Korea Exchange to strengthen its market surveillance system and expand staffing to accelerate investigations into unfair stock trading.

Kang said the government plans to introduce a “one-strike-out” policy for stock manipulation and impose heavy fines to recover illicit gains.

As Lee followed up on his pledge to boost the stock market by visiting the main bourse on Wednesday, the benchmark KOSPI surpassed the two-thousand-900 mark for the first time in some three years and five months. 
Kim Bum-soo, KBS World Radio News.