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Government Promised 20% Loss Coverage, But National Growth Fund Faces Principal Losses The National Growth Fund, heavily promoted by the government as providing up to 20% loss coverage, has entered a loss phase shortly after its launch, leading to growing dissatisfaction among investors. This discontent has intensified, particularly following a recent sharp decline in the domestic stock market, resulting in some investors already experiencing principal losses.On August 4, various online communities shared posts titled 'Current Status of the National Growth Fund, which promised to cover losses up to 20%.'One post included a screenshot showing an investor's status in the KB National Growth Mixed Fund, revealing a drop in the investment from 15 million won to a current valuation of 14,329,800 won. The loss rate was reported at -4.47%, with a valuation loss of approximately 670,200 won.This fund is part of a government initiative aimed at revitalizing the domestic stock market and promoting a culture of long-term investment. At its launch, the fund's structure, which promised to cushion losses up to a certain level, led to a rapid sell-out.However, some investors have misunderstood the loss coverage structure. The so-called '20% loss coverage' does not guarantee that investors will not incur losses; rather, it serves as a mechanism to cushion some losses under specific conditions. Consequently, the fund's valuation can decline based on market conditions, and principal losses can occur.As volatility in the domestic stock market has increased, concerns have emerged in online communities about whether the 20% loss coverage threshold has already been breached.Comments from users included remarks such as, 'The five directors—Lee Jae-myung, Kim Yong-beom, Lee Chan-jin, Kim Sung-joo, and Lee Ok-won—are scrambling to cover up their mess,' and 'If this had come out earlier, wouldn't we be looking at a -30% loss?' Others expressed frustration, saying, 'Why should I be forced to buy this?' and 'It's already funny that we're breaching the 20% mark.' One user quipped, 'National participation is over; it's time for national incineration.'Experts advise that even with a loss cushioning mechanism, funds are fundamentally performance-based financial products, meaning that principal is not guaranteed. They stress the importance of understanding the loss coverage methods and conditions before investing.* This article has been translated by AI. 2026-08-04 10:08:00
Samsung chief receives highest stock dividends in South Korea in 1st half SEOUL, August 4 (AJP) - Samsung Electronics Chairman Lee Jae-yong received the largest dividends in the first half of this year, according to data released by corporate tracker Leaders Index on Tuesday. Lee topped the list with 72.8 billion South Korean won (about US$50 million), followed by Hyundai Motor Group's honorary chairman Chung Mong-koo with 67.1 billion won and tycoon-turned-former politician Chung Mong-joon, the current chairman of the Asan Foundation, with 54.6 billion won. Hong Ra-hee, Lee's mother and honorary director of the conglomerate-run Leeum Museum of Art, who was last year's top recipient, slipped to fourth place after selling shares to pay inheritance taxes, with her dividends falling to 54.4 billion won. Other top recipients included Samsung heiresses Lee Seo-hyun of Samsung C&T and Lee Boo-jin, president of Hotel Shilla, who received 34.1 billion won and 31.2 billion won, respectively, followed by Hyundai Motor Group's chairman Chung Eui-sun with 28.4 billion won and SK Group's chairman Chey Tae-won with 19.5 billion won. Meanwhile, some 127 out of South Korea's 2,873 listed companies disclosed dividend amounts for the first six months of this year, up 48 percent from 86 a year earlier, marking a sharp increase driven by revisions to related laws. The total amount of dividends rose 18.4 percent to 13.52 trillion won from 11.42 trillion won, while dividends increased at 105 companies, declined at 12 and remained unchanged at 10. Samsung Electronics ranked first in terms of total dividend payouts with 4.91 trillion won in the first half of the year, including 2.45 trillion won for the first quarter and 2.46 trillion won for the second quarter. Hyundai Motor ranked second with 1.31 trillion won. 2026-08-04 10:04:56
People Power Party Calls for Defense Minister Ahn Gyu-baek's Resignation The People Power Party on August 4 called for the resignation of Defense Minister Ahn Gyu-baek. They stated that he should be held accountable for a series of incidents, including military personnel conducting guard duties without live ammunition and a commotion caused by mistaking a U.S. military drone for an unidentified flying object.Park Chung-kwon, the party's chief spokesperson, criticized the situation in a statement, saying, "The Republic of Korea's military, once boasting the fifth-largest military power in the world, is deteriorating into a 'Tang Dynasty Army' under the incompetence of a defense minister with a background in defense."He referenced the investigation results from the Joint Chiefs of Staff regarding the incident on July 30, where a U.S. military drone was misidentified as an unidentified flying object, stating, "The military reporting system did not function at all." He added, "With a minister lacking professionalism and morality holding only show meetings, the on-site command and reporting system is fundamentally shaken. The causes of the collapse of the military's surveillance, reporting, command, and control systems must be thoroughly re-examined. Do not try to blind the public with a 'tail-cutting' measure like the exclusion of the 1st Corps commander."Park urged Minister Ahn to resign, stating that he has led the national security network to a complete breakdown. He remarked, "A minister who cannot even clarify allegations of desertion from his time as a defense soldier cannot establish strict military discipline."Members of the National Defense Committee from the People Power Party also held a press conference the previous day, demanding a thorough investigation into the military's handling of the situation and the implementation of responsible measures that the public can accept.Lim Jong-deuk, the opposition party's secretary of the National Defense Committee, noted, "While the two incidents may seem separate, they share the same essence of a shaken alert posture and a collapsed reporting system." He emphasized the need for a thorough investigation of the entire command structure and called for a special inspection of the military's alert posture and measures to prevent recurrence.He further warned, "There is no value that takes precedence over the lives of the people and national security. There can be no compromise on security, and there must be no gaps in vigilance."* This article has been translated by AI. 2026-08-04 10:04:20
Hanwha Solutions Shares Rise Over 8% Following Kim Dong-kwan's Capital Increase Participation Hanwha Solutions is experiencing strong early trading gains following news of Kim Dong-kwan's participation in a capital increase. As of 9:49 a.m. on August 4, the Korea Exchange reported that Hanwha Solutions shares rose by 2,150 won (8.67%) to 26,950 won. The stock even reached 27,650 won at one point during early trading.The announcement of Kim's participation in the capital increase has boosted investor sentiment. Typically, capital increases can negatively impact stock prices due to concerns over share dilution. However, Kim's involvement is being interpreted as a sign of the company's commitment to long-term growth, which has helped lift the stock price.In a disclosure, Hanwha Solutions revealed that Kim acquired 23,153 common shares through the capital increase on July 31. His total shareholding has increased from 81,400 shares to 104,553 shares. The largest shareholder, Hanwha, also saw its holdings rise to 80,357,854 shares, representing a 35.61% stake.The company's improved performance is also supporting its stock price. On July 29, Hanwha Solutions announced that its consolidated revenue for the second quarter reached 4.5826 trillion won, with an operating profit of 306.5 billion won. This marks a 47.0% increase in revenue and a 200.3% increase in operating profit compared to the same period last year. The quarterly operating profit of over 300 billion won is the highest since the third quarter of 2022.Notably, the renewable energy sector led the performance improvement, reporting revenue of 2.4823 trillion won and an operating profit of 166.4 billion won, driven by rising module sales prices and increased asset sales. The chemicals sector also achieved a profit for the second consecutive quarter, with revenue of 1.465 trillion won and an operating profit of 87.1 billion won, supported by rising product prices and stabilized raw material procurement.Analysts are optimistic that Hanwha Solutions will continue to improve its performance in the second half of the year. Baek Young-chan, a researcher at Sangsangin Securities, stated, "The issues surrounding the capital increase in the first half have largely been resolved, and we expect significant performance improvements in the second half due to the full commercialization of the solar power plant in Cartersville, Georgia."He added, "Additionally, the upcoming announcement of the U.S. Trade Expansion Act (Section 232) this month is expected to provide further momentum for the North American solar business, and the recent stock price adjustment presents a buying opportunity."* This article has been translated by AI. 2026-08-04 10:04:10
Bank of Korea Projects Higher Inflation in August Amid Rising Core Prices The consumer price inflation rate has dropped to the 2% range for the first time in three months, but the Bank of Korea forecasts that it may rise again this month. Excluding food and energy, core inflation is expected to continue its upward trend for the time being.On August 4, the Bank of Korea held a price situation review meeting led by Deputy Governor Lee Ji-ho to assess recent price trends and future outlooks.According to the National Data Agency, the consumer price index last month was 119.77 (2020=100), reflecting a 2.8% increase compared to the same month last year. The inflation rate remained in the 2% range from January to April this year, rose to the 3% range in May and June, and has now returned to the 2% range after three months.The Bank of Korea noted that the consumer price increase in July slowed compared to the previous month due to factors such as a reduction in oil prices and a decline in agricultural product prices. The inflation rate for living expenses, which heavily relies on oil and agricultural products, also significantly decreased to 2.5%.In contrast, core inflation saw a slight increase as cost shocks were transmitted over time, leading to a rise in durable goods prices.The Bank of Korea anticipates that the consumer price inflation rate may expand again in August. This is attributed to a base effect from significant discounts on communication fees by some mobile carriers last August, which is expected to result in a higher year-on-year inflation rate.Deputy Governor Lee stated, "Given the high uncertainty related to the Middle East conflict, government measures for price stability are expected to act as downward pressure. However, due to the transmission of cost shocks and increased demand-side pressures, core items are likely to continue experiencing high inflation rates, so we will remain vigilant in monitoring the price situation."* This article has been translated by AI. 2026-08-04 10:04:10
KFTC Launches Unfair Subcontracting Reporting Center Ahead of Chuseok In preparation for the Chuseok holiday, South Korea's Fair Trade Commission (KFTC) will operate an Unfair Subcontracting Reporting Center to ensure that small and medium-sized subcontractors receive timely payments.The KFTC announced on August 4 that the reporting center will be established and operated from August 5 to September 23, covering a 50-day period leading up to the holiday.As the demand for funds typically surges among small businesses during Chuseok due to bonuses and other expenses, the KFTC aims to actively encourage timely payments for subcontracting work during this period. For any unpaid amounts, the commission will promote voluntary corrections by the primary contractors and facilitate agreements between parties, with on-site investigations conducted if necessary.The reporting center will be set up in 12 locations across five regions nationwide: seven in the Seoul metropolitan area, two in Daejeon and Chungcheong, one in Busan and Gyeongnam, one in Gwangju and Jeolla, and one in Daegu and Gyeongbuk. The two offices established in March this year in the Gyeongin area will also be operational. Notably, centers will be established not only at the KFTC headquarters and local offices but also at the Subcontracting Dispute Mediation Council.Reporters can receive assistance regarding unpaid amounts through phone consultations, allowing for quick resolutions. Primary contractors, identified as respondents, will have the opportunity to rectify payment issues before formal proceedings are initiated.Additionally, the KFTC has requested major economic organizations, including the Korea Chamber of Commerce and Industry, the Korea Employers Federation, the Korea Economic Association, and the Korea Construction Association, to encourage their member companies to ensure timely payments for subcontracting work before Chuseok. The commission also plans to urge cooperation to facilitate early payments for amounts scheduled for disbursement after the holiday.During the previous Lunar New Year holiday, the KFTC's reporting center facilitated the payment of 182 cases of unpaid subcontracting fees, totaling approximately 23.2 billion won, benefiting 23,766 subcontractors with early payments amounting to about 34.8 trillion won.A KFTC official stated, "We expect that the operation of the Unfair Subcontracting Reporting Center will contribute to alleviating the financial difficulties of small and medium-sized enterprises by promoting voluntary corrections of unpaid subcontracting fees and encouraging early payments before the holiday."* This article has been translated by AI. 2026-08-04 10:04:00
Increased Penalties for Unfair Trade Practices in Subcontracting, Franchising, and Dealerships The penalties for unfair trade practices in subcontracting, franchising, and dealership sectors will be significantly increased. For repeated violations, fines can be raised by up to 100%.The Fair Trade Commission announced on August 4 that it will implement revised penalty guidelines for the Subcontracting Act, Franchise Business Act, and Dealer Act starting today. This revision aims to enhance deterrence against legal violations, reflecting concerns that current penalties are too low for serious infractions.A key feature of the revised guidelines is the rationalization of penalty criteria. To address the issue of low penalties for serious violations, the rates and amounts for fixed and percentage-based fines have been increased, and the classification of severity has been expanded from three to four levels.Sanctions for repeated violations will be significantly strengthened. For a single violation within the past five years, fines can be increased by up to 50%, and for multiple violations, the maximum penalty can reach 100%.The commission will also enhance responses to retaliatory actions taken against those who report violations or seek dispute resolution. In the dealership sector, the penalty increase rate will rise from 20% to 30%, and a new basis for increasing penalties in the franchising sector has been established, allowing for increases of up to 30%.The grounds and scope for reductions in penalties have been narrowed. Previously, self-correction could lead to a reduction of up to 50%, but now it is limited to a maximum of 10% if the violation's effects are substantially eliminated. The cooperation reduction, which applied separately to investigations and reviews (up to 20%), will now be reduced to a maximum of 10% only if cooperation is provided throughout the entire process. Additionally, the 'minor negligence reduction' provision in the franchising sector has been removed.A Fair Trade Commission official stated, "With this revision, the level of penalties for unfair trade practices in subcontracting, franchising, and dealership sectors will be effectively strengthened. We expect this will deter legal violations by businesses and help establish a fairer trading order."* This article has been translated by AI. 2026-08-04 10:04:00
Elimination of Reward Cap for Direct Sales Law Violations The Fair Trade Commission (FTC) will eliminate the cap on reward payments related to violations of the Direct Sales Law. Additionally, the commission will now provide rewards to employees involved in such violations, aiming to facilitate the early detection of concealed infractions.On August 4, the FTC announced that it will prepare a revision of the enforcement decree for the Direct Sales Law, which will be open for public comment until September 14. This revision follows changes made in June to the reward payment regulations for whistleblowers reporting violations of the Fair Trade Act.Currently, the reward payment cap is set at 10 million won. Unlike other laws overseen by the FTC, the Direct Sales Law directly stipulates this cap in its enforcement decree. As a result, merely amending the reward regulations was insufficient to increase the reward amount.The proposed revision will remove the reward cap, allowing whistleblowers to receive up to 10% of the maximum penalty imposed for violations under the revised reward regulations.Furthermore, the scope of eligible recipients for rewards will be expanded to include employees involved in the violations. The current enforcement decree excludes both the violating business operators and their employees from receiving rewards.By allowing rewards for employees involved in violations, the FTC believes it will enhance the likelihood of securing evidence related to infractions, thereby increasing the chances of early detection of concealed violations. Additionally, the possibility of internal whistleblowing may deter future violations.The FTC stated, "Through the revision of the enforcement decree, we aim to promote internal reporting of violations of the Direct Sales Law, which are often concealed. We believe this will enhance the effectiveness of law enforcement and help prevent consumer harm by enabling early detection of violations and rapid mitigation of damage."* This article has been translated by AI. 2026-08-04 10:04:00
Six out of Ten New Cars Registered This Year Are Eco-Friendly Six out of ten new cars registered this year are eco-friendly vehicles. The number of electric vehicles (EVs) has more than doubled compared to last year, while registrations of internal combustion engine vehicles have declined.The Korea Automobile Mobility Industry Association (KAMA) reported on August 4 that the total number of new vehicle registrations in the first half of 2026 reached 850,636, a 1.3% increase from the same period last year.Despite various challenges, including prolonged high oil prices and exchange rates due to ongoing conflicts in the Middle East and supply chain disruptions, the automotive market has managed to withstand downward pressure. This resilience is attributed to early execution of government EV subsidies, a rush to register vehicles before the expiration of individual consumption tax reductions, and increased demand from corporate and rental businesses.While the share of individual buyers has decreased by 3.3% compared to the same period last year due to sustained high interest rates, purchases by corporate and rental businesses increased by 10.5% to 296,747 units, providing a crucial support for domestic sales. The shift in purchasing patterns from ownership to service utilization has absorbed the new electric vehicle lineup into the B2B (business-to-business) channel.In terms of powertrains, electric vehicles (HEV, BEV, FCEV) accounted for 57.8% of the market, solidifying their position as the dominant segment.Battery electric vehicles (BEVs) surged by 113.6% year-on-year to 198,509 units, achieving a penetration rate of 23.3%, driven by the expansion of affordable EV models and the influx of imported electric vehicles from brands like Tesla and BYD.Hybrid electric vehicles (HEVs) also maintained a strong presence, with sales of 289,814 units (34.1% market share) despite supply chain issues.Conversely, the market share of pure internal combustion engine vehicles dropped from 53.7% last year to 42% this year, a decrease of 11.7 percentage points. Notably, diesel vehicle sales plummeted by 59.5% compared to the same period last year due to the discontinuation of certain passenger trims and supply restrictions on some models.KAMA attributed the rapid growth of electric vehicles this year to the establishment of the 'EV Transition Support Fund,' early execution of subsidies by local governments, and high oil prices.In fact, registrations of imported vehicles surged by 30.0% year-on-year, capturing a 22.7% share of the domestic market.The influx of Chinese models from Tesla, BYD, and Polestar has led to China becoming the largest source of imported vehicles, accounting for 41.2% of the total import market share.German brands, which previously held over half of the imported vehicle market, have seen their share drop to 42.2%, losing their majority status.While the rapid influx of Chinese electric vehicles has positive aspects, such as lower prices and increased consumer choice, it also poses challenges to domestic manufacturing and intensifies supply chain competition. There is a pressing need to secure price competitiveness for domestic vehicles and establish protective measures for the ecosystem.KAMA Chairman Jeong Dae-jin stated, "The aggressive push of Chinese electric vehicles in both global and domestic markets poses a serious threat to the manufacturing base and supply chain competitiveness of the domestic automotive industry. To overcome this transitional crisis, it is essential to include electric vehicles in the 'Domestic Production Promotion Tax System' to enhance the competitiveness of the entire domestic production infrastructure and ecosystem."He added, "There are concerns about demand slowing down due to the depletion of local subsidies, so it is necessary to expedite securing and announcing supplementary budgets for subsidies by local governments in the second half of the year. Continued tax benefits, such as individual consumption tax reductions for eco-friendly vehicles, including HEVs, are essential to maintain momentum during this transitional phase toward electrification."* This article has been translated by AI. 2026-08-04 10:00:10
Daewoo Engineering Reports 109% Increase in Operating Profit for First Half of 2026 Daewoo Engineering has shown significant improvement in profitability, doubling its operating profit despite a decline in revenue during the first half of the year.On August 4, Daewoo Engineering announced that it recorded consolidated revenue of 3.9949 trillion won, operating profit of 487.9 billion won, and net profit of 363 billion won for the first half of 2026.Revenue decreased by 8.2% from 4.35 trillion won in the same period last year. Revenue by business segment included 2.6656 trillion won from the construction division, 743.3 billion won from civil engineering, 511.5 billion won from the plant division, and 74.5 billion won from other consolidated subsidiaries.In contrast, operating profit increased by 109.0% compared to 233.5 billion won in the same period last year. The operating profit margin rose significantly from 5.4% in the first half of last year to 12.2% this year. Net profit surged from 15 billion won last year to 363 billion won.A Daewoo Engineering official explained, “Although revenue slightly decreased due to a reduction in ongoing projects, the stabilization of cost rates and improved profitability in the construction division contributed to a substantial increase in operating profit.”New orders for the first half of the year reached 7.1285 trillion won, a 22.4% increase from 5.8224 trillion won in the same period last year. The company secured contracts primarily in domestic construction projects, including the redevelopment of Seongnam Shinheung District 3, residential complexes in Cheonan Seongjeong-dong, and the third Pangyo Techno Valley in Seongnam.As of the end of the first half, the order backlog stood at 53.4019 trillion won, equivalent to approximately 6.6 years of work based on annual revenue.Daewoo Engineering has also raised its annual new order target from 18 trillion won to 27 trillion won, following the visibility of large project opportunities such as the Papua New Guinea LNG and Mozambique Rovuma LNG.While the construction industry continues to face cost pressures and a selective approach to new orders, Daewoo Engineering's performance reflects a management focus on improving profitability rather than just expanding size.The company plans to expand its presence in domestic and international markets, focusing on core sectors such as nuclear power and LNG, while strengthening its bids in high-value areas like overseas urban development projects, data centers, and urban renewal projects.A Daewoo Engineering official stated, “We will do our best to exceed this year’s targets through the expansion of quality orders and thorough risk management.”* This article has been translated by AI. 2026-08-04 10:00:00