South Korea's financial authorities are moving to appoint Chief Inclusion Officers (CIFOs) within banks and financial institutions to tackle the issue of financial exclusion, which President Lee Jae-myung has described as a problem of "predatory finance." This initiative aims to implement structural changes to address the root causes of financial exclusion. Additionally, to encourage foreign investment in the domestic stock market, the authorities plan to expand the trading scope of integrated foreign accounts to include exchange-traded funds (ETFs) and will hold a large-scale overseas investment briefing in September.
On May 21, Financial Services Commission Chairman Lee Ok-yeon stated during a meeting with reporters, "We need fundamental improvements to how we address the structural issues that create financial exclusion." He announced plans to establish a Financial Inclusion Strategy Promotion Team in June, which will consist of four divisions: general, policy for the underprivileged, financial industry, and credit infrastructure.
The general division will focus on designating CIFOs within financial companies to discuss ways to improve access to finance for low-income and vulnerable groups at the board and governance levels. The team will also consider measures such as providing immunity for employees actively engaged in financial inclusion efforts, establishing a comprehensive evaluation system for financial inclusion, and linking evaluation results to financial company incentives and compensation.
Lee emphasized, "While we have focused on urgently rescuing marginalized groups pushed out of the formal financial system, it is now time to improve the structures that lead to financial exclusion."
[Samsung Electronics New Normal] Bonus Inclusion in Average Wage Could Increase Severance Pay by Sixfold, Raising Concerns
Samsung Electronics has reached an agreement with its labor union to fix bonuses at over 10% of business performance and maintain a "special management bonus" funded by 10.5% of the semiconductor division's business performance for the next decade.
While the company has specified conditions for bonus payments, such as achieving an operating profit of 200 trillion won in the semiconductor division, concerns remain that these bonuses could be included in the average wage, which would significantly increase the severance pay burden on Samsung. Estimates suggest that if the bonus of approximately 600 million won per employee is included in the average wage, the severance pay could rise by more than eight times, potentially negatively impacting the South Korean economy.
According to industry sources on May 21, the special management bonus agreed upon by Samsung and its labor union is not expected to be included in the standard wage. The Supreme Court's full bench is set to rule in 2024 that bonuses must meet criteria of regularity, uniformity, and fixed nature to be considered part of standard wages.
The prevailing view is that this agreement does not meet these three conditions. Specific conditions outlined in the agreement, such as achieving an operating profit of 200 trillion won in the semiconductor division from 2026 to 2028 and 100 trillion won annually from 2029 to 2035, along with the unspecified minimum payment amount and the annual variability of the total funding based on business performance, do not constitute "value of labor" according to recent Supreme Court rulings on standard wages.
[Starbucks Controversy Aftermath] Boycott Turns into Ideological Battleground, Risk of Losing Loyal Customers
The controversy surrounding Starbucks Korea's "Tank Day" has escalated into a boycott and political debate, raising concerns about the potential impact on the company's loyal customer base and overall brand image. Industry insiders warn that this situation could disrupt Starbucks' revenue structure.
As of May 21, posts sharing methods for refunding Starbucks cards have rapidly spread across online communities and social media platforms following the "Tank Day" controversy. Some users have encouraged participation in the boycott by posting screenshots of the Starbucks app's membership cancellation page or refund confirmations.
The backlash has also reached the political arena, with criticism that Starbucks has downplayed the Gwangju Democratization Movement. Within the Democratic Party, there are calls to refrain from visiting Starbucks, and organized boycotts are emerging in the Gwangju and Jeonnam regions. On May 21, the city of Gwangju issued a statement declaring that it views the Starbucks Korea incident as a significant social disaster caused by a CEO lacking historical awareness, not merely a mistake by a staff member, and announced a ban on using Starbucks gift cards at city-sponsored events.
Industry experts are closely monitoring the potential impact of the boycott and refund requests on Starbucks' customer retention strategy, which relies on a prepaid charging structure combined with a rewards program to keep loyal customers within its ecosystem.
[June 3 Local Elections] Pressure for Candidate Unification Grows in Busan's North District, Signs of Division in the People Power Party
In the Busan North District, a key battleground for the June 3 by-elections, Democratic Party candidate Ha Jung-woo and independent candidate Han Dong-hoon are in a tight race within the margin of error. As pressure mounts for unification between People Power Party candidate Park Min-sik and Han, the party is showing signs of division.
According to political sources on May 21, Han has taken the lead in support for the first time in the three-way race. Previously, Ha had consistently led in polls, but recent data shows Han at 34.6%, Ha at 32.9%, and Park at 20.5%, based on a survey conducted by Research & Research from May 17 to 19 among 500 eligible voters in the Busan North District.
The gap between Han and Ha is within the margin of error of 1.7 percentage points (the survey used a 100% mobile phone interview method with a sampling error of ±4.4 percentage points at a 95% confidence level, with a response rate of 10%. For more details, refer to the Central Election Survey Deliberation Committee's website).
Calls for unification are growing within the People Power Party. Representative Park Soo-young urged the party leadership to make a decision regarding candidate unification in Busan North. He reportedly stated in a group chat that his district, Busan Nam-gu, is currently trailing the Democratic Party by 10 to 15 percentage points, and emphasized that without decisive action from the Busan city party and the central party, the election will be challenging.
Iran Establishes 'Controlled Area' in the Strait of Hormuz, Requires Pre-Approval for All Vessels
The Iranian government has announced the establishment of a "controlled area" in the Strait of Hormuz, managed by the newly formed Persian Gulf Strait Authority (PGSA), under the pretext of regulating navigation in the strait.
On May 20, the PGSA stated via social media platform X (formerly Twitter) that the eastern boundary of the controlled area will be defined by a straight line connecting Iran's Kouh-e Mobarak and the southern UAE city of Fujairah. The western boundary will connect Iran's Qeshm Island and the UAE's Umm al-Quwain.
Earlier reports from AP and CNN indicated that the Iranian government aims to formalize its control over the Strait of Hormuz through the establishment of the PGSA.
CNN reported that the authority has notified the shipping industry that it will require all vessels to complete a "Vessel Information Declaration" form to ensure safe navigation. According to a document obtained by CNN, the form consists of over 40 items, including the vessel's name and identification number, departure country, destination, owner and operator nationality, and cargo information. Past names of the vessel must also be included, and this information must be submitted to Iranian authorities via email before passing through the Strait of Hormuz.
* This article has been translated by AI.
Copyright ⓒ Aju Press All rights reserved.