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  • Deputy Prime Minister Nominee Lee Hyung-il Aims to Boost Potential Growth Rate
    Deputy Prime Minister Nominee Lee Hyung-il Aims to Boost Potential Growth Rate Lee Hyung-il, the nominee for Deputy Prime Minister and Minister of Finance, stated on August 30, "I will work hard to create new investment and growth opportunities to lay the groundwork for a rebound in the potential growth rate."President Lee Jae-myung nominated Lee Hyung-il, the current first vice minister of the Ministry of Finance, as the next economic deputy minister. The nominee is recognized as a macroeconomic expert, having held key positions within the Ministry of Finance since entering public service. He is also regarded as a capable figure who has been appointed across different administrations.In his remarks following the nomination, Lee expressed, "I feel an immense sense of responsibility being named the second deputy prime minister nominee since the launch of the Lee Jae-myung administration."He assessed that the South Korean economy is at a critical juncture requiring new challenges to achieve a significant leap toward becoming an 'irreplaceable South Korea,' moving beyond recovery and normalization.Lee emphasized, "I will strive to solidify the growth momentum our economy has achieved over the past year and three months, and create new investment and growth opportunities through major projects to lay the foundation for a rebound in the potential growth rate."Finally, he stated, "I plan to do my utmost to ensure that the benefits of growth are distributed evenly among all citizens, leveraging the policy capacity secured through the semiconductor boom to address issues like polarization and support people's livelihoods."* This article has been translated by AI. 2026-08-30 17:48:10
  • Residents of Gwangmyeong Decide on 2027 Community Projects
    Residents of Gwangmyeong Decide on 2027 Community Projects Residents of Ha안4-dong and Iljik-dong in Gwangmyeong held a community assembly on August 29 to select projects for 2027 and discuss local issues, continuing their push for community-led change. According to the city, Ha안4-dong residents voted to select four out of five proposed projects, while Iljik-dong confirmed all four suggested projects and discussed ways to revitalize Iljik Riverside Park. The Ha안4-dong Residents' Council hosted the '2026 6th Ha안4-dong Community Assembly' at Yeonseo Elementary School gymnasium, attended by over 150 residents. The assembly began with a popera performance and a children's taekwondo demonstration, followed by a report on the 2025 audit and the 2026 activities of the Residents' Council. Residents shared their opinions on the 2027 community projects before voting to directly decide on next year's initiatives. The proposed projects included making kimchi with neighbors, dressing trees along Hadam-gil, promoting active senior center living, organizing outings, and establishing a community market. After voting, four projects were selected for implementation in 2027. Kim Yong-man, chair of the Residents' Council, stated, “Thanks to the interest and participation of residents, the autonomy of Ha안4-dong has grown significantly. We will pursue projects that are genuinely helpful based on the voices of the residents.” Lee Jae-hee, head of Ha안4-dong, remarked, “The process of residents contemplating and deciding on necessary projects for the community is a crucial foundation for resident autonomy. We will actively support the Residents' Council to ensure diverse opinions lead to actual community projects.” Iljik-dong Confirms Four Community Projects and Discusses Local Issues Meanwhile, the Iljik-dong Residents' Council also held the '2026 Iljik-dong Community Assembly' at the Iljik-dong Community Center, attended by over 200 residents, to discuss local issues. The assembly began with a video showcasing the year's activities of the Iljik-dong Residents' Council, followed by reports on audits and operational results, and the presentation of the 2027 autonomy plan and community project agenda. Residents proposed four projects: Gwangmyeong Saebit Cultural Square, neighborhood shuffle dance classes, Life+, and a life transition academy, all of which were confirmed for implementation in 2027 after receiving majority support from attendees. Additionally, a discussion on revitalizing Iljik Riverside Park allowed residents to share various opinions on local issues and explore directions for community development. Park Hyo-soon, chair of the Residents' Council, said, “It was great to see many residents come together to discuss and decide on necessary projects for the community. We will continue to communicate comfortably with residents and create initiatives that Iljik-dong needs.” Kang Young-sook, head of Iljik-dong, noted, “It was encouraging to see residents actively contemplating and deciding on necessary projects for the community. We will carefully monitor the implementation of the projects proposed by residents.” Meanwhile, Park Seung-won, the mayor, emphasized, “Community change begins with the voices of residents who are closest to local issues. Gwangmyeong will actively support residents in identifying necessary projects and gathering diverse opinions to turn them into action.”* This article has been translated by AI. 2026-08-30 17:48:00
  • National Assembly Enters Confirmation Hearings for Six Ministerial Nominees
    National Assembly Enters Confirmation Hearings for Six Ministerial Nominees President Lee Jae-myung nominated six candidates for ministerial positions on August 30, prompting the National Assembly to enter a period of confirmation hearings. Once the nomination documents are submitted to the Assembly, hearings are expected to take place by committee no later than the third week of next month.Kim Min-seok, leader of the Democratic Party, expressed his support on Facebook, stating, "I welcome the cabinet reshuffle, which symbolizes capability, youth, and the strengthening of progressive reform alliances. The party will verify expertise through the hearings and will work diligently to ensure stability and success in governance through enhanced cooperation with the administration."In contrast, Jang Dong-hyuk, leader of the People Power Party, criticized the nomination of Kim Seung-won, a Democratic Party lawmaker and former attorney involved in the Daejang-dong case, as a choice aimed at securing a favorable outcome in his own legal proceedings. He warned, "The People Power Party will rigorously question the flawed appointments during the confirmation hearings."Floor leader Jeong Jeom-sik also criticized the administration's focus on legal matters over economic and security issues, while Im Yi-ja, chair of the policy committee, stated, "We will closely examine whether this appointment truly serves the public interest during the upcoming hearings," indicating a commitment to thorough scrutiny.Political analysts predict that the Legislation and Judiciary Committee will be the most contentious battleground during this confirmation period. Kim Seung-won has been a vocal advocate for dismissing charges related to President Lee and has been associated with strong reformist views, including calls to abolish supplementary investigative powers.The People Power Party is likely to approach the confirmation hearings with the goal of disqualifying Kim, given their firm stance against the dismissal of charges related to the President. If the Democratic Party defends Kim, who serves as the ruling party's secretary on the committee, significant clashes between the parties are anticipated.Confirmation hearings for the nominees for the Ministry of Finance and the Ministry of Land, Infrastructure and Transport are also expected to spark debate. The People Power Party argues that a shift in economic and real estate policy is necessary, but the promotion of current vice ministers sends a message of maintaining existing policy directions.Particularly, Hong Ji-seon, the nominee for the Ministry of Land, Infrastructure and Transport, faces numerous pressing issues, including the August 13 measures and the utilization of the Yongsan Park site, and will likely undergo a challenging verification process, especially since the opposition holds the chairmanship of the committee. Kang Sin-cheol, the nominee for the Ministry of National Defense, is also expected to face aggressive questioning regarding issues such as the consolidation of military academies and the reduction of joint U.S.-South Korea military exercises.Ahead of the confirmation hearings, both parties have already begun to engage in a war of words. Lee Yong-woo, spokesperson for the Democratic Party, told reporters, "The People Power Party is attempting to tarnish the candidates' reputations with false claims. We must verify the candidates' abilities, qualifications, and policy visions. I urge them to approach the hearings with a sense of responsibility." Choi Bo-yoon, chief spokesperson for the People Power Party, expressed hope for a transparent confirmation process that meets public expectations, stating, "We will thoroughly engage in the hearings."Meanwhile, the National Assembly is required to conduct confirmation hearings within 15 days of the submission of the nomination documents and to complete the confirmation process within 20 days.* This article has been translated by AI. 2026-08-30 17:40:10
  • South Koreas Nepal Rescue Team Continues Helicopter Operations Amid Flood Search
    South Korea's Nepal Rescue Team Continues Helicopter Operations Amid Flood Search The South Korean government is actively conducting helicopter operations to locate nine South Koreans missing due to severe flooding in Nepal.According to the Ministry of Foreign Affairs on August 30, two helicopters are scheduled to operate that day: one chartered by the government and another from Doosan Enerbility. Operations require approval from the Nepalese military, which is leading the search and rescue efforts.On the previous day, one government-chartered helicopter took off twice. Reports indicate that only South Korean helicopters received takeoff clearance, aside from those operated by the Nepalese government.The second government rapid response team, dispatched on August 29, brought drones for local search efforts. However, the use of drones also requires permission from local authorities, and the rapid response team will decide on their deployment based on the situation on the ground.While the Nepalese government has generally prohibited the operation of foreign-chartered helicopters, the Nepalese military is conducting ground searches for the missing South Koreans.The helicopter deployed by South Korea the previous day did not land at the site but conducted aerial surveillance and recorded video for further analysis. The government has provided the Nepalese side with coordinates and maps where the missing South Koreans are believed to be located.Authorities believe that there are no South Koreans trapped inside a tunnel at a hydropower plant, where over 100 people are presumed to be trapped. This is because the tunnel is not a workplace for South Koreans, and the distance from their workplace to the tunnel is not walkable, making it unlikely that the missing individuals sought refuge there during the flood.Park Jae-kyung, the newly appointed South Korean ambassador to Nepal, is expected to arrive on August 31. The South Korean embassy in Nepal has been operating under a chargé d'affaires since the recent reassignment of the previous ambassador.Meanwhile, Nepal and China are strengthening cooperation for disaster response and search efforts. Nepal has shifted its stance to accept limited foreign search and rescue assistance, while China has sent tunnel structure experts and agreed to expand the sharing of satellite and hydrological data.According to China's state-run Xinhua News Agency, Wang Yi, head of the Central Foreign Affairs Commission of the Communist Party of China and Foreign Minister, spoke with Nepalese Foreign Minister Pradeep Gyawali on August 29, agreeing to enhance disaster response cooperation between the two countries.During the call, Wang stated, "China has shared important information with Nepal, including images of the disaster area and satellite and hydrological data, which includes alerts related to the upstream landslide lake."Wang emphasized that "China and Nepal are connected by mountains and rivers and share a common destiny. In the face of disaster, the two countries should overcome difficulties together and demonstrate our long-standing friendship through practical actions that transcend the Himalayas."This conversation took place amid controversy over whether there was sufficient early warning and information sharing between the two countries prior to the disaster.A Nepalese Ministry of Home Affairs official pointed out the inadequacy of disaster prevention cooperation between China and Nepal and called for a concrete cooperation framework.On August 28, the Nepalese government effectively retracted its initial position of not accepting foreign search and rescue assistance. Initially, it had stated that it would not accept foreign help, but as the situation worsened, it decided to accept support from foreign experts, including those from China and South Korea, in specific areas.Minister Gyawali has reportedly requested technical support for rescuing people trapped in the hydropower plant tunnel, as well as assistance in restoring roads and communication networks, conducting DNA tests for deceased individuals, and processing remains.In response, China dispatched nine tunnel structure experts to Nepal on August 29, following the earlier deployment of five experts, bringing the total to 14. 2026-08-30 17:40:00
  • Debate Erupts Over Supreme Court Justice Recommendation Process
    Debate Erupts Over Supreme Court Justice Recommendation Process The ruling and opposition parties clashed over Chief Justice Cho Hee-dae's decision to skip a National Assembly inquiry regarding the recommendation of a Supreme Court justice. The ruling Democratic Party argued that President Lee Jae-myung's request for a justice recommendation is valid, while the opposition People Power Party countered that it constitutes 'abuse of power.' The two sides also disagreed on the Chief Justice's obligation to appear before the National Assembly.On August 30, members of the Democratic Party's Legislative and Judiciary Committee held a press conference at the National Assembly, asserting that "the Blue House's request for a recommendation is valid" and emphasized that "one of the remaining three candidates, excluding Son Bong-ki, should be recommended."They criticized Cho's submission of a statement citing the separation of powers as a reason for not attending the inquiry. Kim Seung-won, the ruling party's committee secretary, pointed out that "the committee voted to summon witnesses under Article 129 of the National Assembly Act" and accused Cho of "manipulating the law" by referencing Article 121 of the National Assembly Act.In contrast, People Power Party lawmaker Yoon Sang-hyun stated that "according to Article 62, Section 2 of the Constitution, the Chief Justice has no obligation to appear before the National Assembly" and explained that the lack of obligation should frame the interpretation of Article 129 of the National Assembly Act. Former judge Na Kyung-won of the People Power Party went further, claiming that "the President exercised a power that does not exist in the law regarding the recommendation. This is a clear abuse of power and grounds for impeachment," adding that "this is not a separation of powers but a dictatorship of unified powers."As Cho Hee-dae shows discomfort with the National Assembly by refusing to attend the committee, attention is focused on what choice he will make. According to legal and political circles, Cho's options in response to the unprecedented 'rejection of recommendation' are largely twofold: either recommend from the existing candidate pool or opt for a new recommendation committee. Earlier in January, the Supreme Court Justice Recommendation Committee had recommended four candidates, including Son Bong-ki, Kim Min-ki, a judge at the Suwon High Court, Park Soon-young, a judge at the Seoul High Court, and Yoon Seong-sik, a senior judge at the Seoul High Court.If Cho selects one candidate from the existing pool for re-recommendation, the conflict with the Blue House is expected to be resolved relatively quickly. Recently, it has been reported that the Blue House is considering Judge Kim as a candidate; however, there is a prevailing view within and outside the Supreme Court that this will be difficult to accept due to concerns over political neutrality and the substantive guarantee of the recommendation power following the expansion of the Supreme Court's composition.Ultimately, there is speculation that Cho may form a new recommendation committee based on the existing committee dissolution provisions in the Court Organization Act. However, this would require a lengthy process for the National Assembly's personnel hearing, potentially reigniting discussions of impeachment. A precedent exists from 2012 when Supreme Court Justice nominee Kim Byeong-hwa voluntarily withdrew, leading the Supreme Court to reconstitute the recommendation committee, resulting in a three-month delay for the National Assembly's personnel hearing. 2026-08-30 17:40:00
  • South Korea Mens Volleyball Team Sweeps Bahrain in Two Matches, Boosting Hopes for Upcoming Competitions
    South Korea Men's Volleyball Team Sweeps Bahrain in Two Matches, Boosting Hopes for Upcoming Competitions The South Korea men's volleyball team achieved a clean sweep against Bahrain in two exhibition matches, raising expectations for upcoming international competitions.Under the guidance of head coach Isanaye Ramirez, South Korea (ranked 26th in the world) defeated Bahrain (ranked 44th) in the second match of the '2026 South Korea-Bahrain Diplomatic Relations 50th Anniversary National Team Exhibition' held at the Cheonan Yu Gwan-sun Gymnasium on August 30, with a set score of 3-0 (26-24, 25-16, 25-20).Having previously won the first match 3-1 on August 29, South Korea concluded the domestic exhibition series with two consecutive victories.The team's 'twin towers,' Dong-hyuk Lim (Korean Air) and Su-bong Heo (Hyundai Capital), showcased their offensive prowess, with Lim scoring 13 points and Heo contributing 11 points.Setter Tae-jun Han (Woori Card), who filled in for the injured Taek-yeong Hwang (KB Insurance), also stood out with stable game management and four points from solo blocks.The turning point came in the first set. South Korea trailed 17-21 but rallied back with a quick attack from Jun-hyuk Choi (Korean Air), a block from Han, and a service ace from Lim, closing the gap to just one point. In a tense battle that reached deuce at 24-24, South Korea seized the set point due to a service error from Bahrain, and Sang-hyun Lee (Military Sports Corps) blocked an attack to clinch the first set.With momentum on their side, South Korea dominated the second set, winning by a margin of nine points.In the third set, South Korea maintained control, reaching 20 points first with a back-row attack from Jae-young Lim (Korean Air) and another service ace from Heo. They continued to build their lead, completing the match with a 3-0 victory.With two wins in the exhibition series, the team is set to compete in the 2026 AVC Asian Championship, taking place in Fukuoka, Japan, from September 4 to 13. The championship's winning team will earn a spot in the 2028 Los Angeles Olympics, while the top three teams will secure berths in the 2027 FIVB Volleyball World Cup.Following the Asian Championship, the team will head directly to the 2026 Aichi-Nagoya Asian Games. After suffering a disappointing early exit in the last Hangzhou Games, South Korea's men's volleyball team aims to restore its pride in this upcoming competition. 2026-08-30 17:36:10
  • President Lee Reshuffles Six Cabinet Positions, Including Finance and Defense Ministers
    President Lee Reshuffles Six Cabinet Positions, Including Finance and Defense Ministers President Lee Jae-myung announced a significant cabinet reshuffle on August 30, replacing ministers in six key departments, including the Deputy Prime Minister and Minister of Finance. The changes, which also affect the Ministry of Land, Infrastructure and Transport, signal a commitment to revitalizing governance in the second year of his administration. Amid declining public support, the appointments reflect a desire for unity by including figures from both the ruling coalition and the pro-Moon Jae-in faction.On this day, President Lee revealed the nominees for the six cabinet positions: the Ministry of Finance, the Ministry of Land, Infrastructure and Transport, the Ministry of SMEs and Startups, the Ministry of National Defense, the Ministry of Justice, and the Ministry of Gender Equality and Family.Lee Hae-min, nominated as Deputy Prime Minister and Minister of Finance, is a seasoned policymaker with experience as the Director of Economic Policy at the Ministry of Economy and Finance and as an economic policy secretary in the Presidential Office.Hong Ji-sun, currently the Second Vice Minister of Land, has spent nearly 28 years in key areas such as railways, roads, and construction in Gyeonggi Province, making her a well-regarded regional bureaucrat with extensive field experience in policy design and implementation.This reshuffle is interpreted as a move to enhance policy coherence by appointing experienced bureaucrats. After the announcement, President Lee emphasized on X (formerly Twitter), "The government of the people will eradicate the disastrous real estate speculation by any means necessary," adding that the government will mobilize all resources for financial and tax reforms, as well as to increase and expedite housing supply.Former Deputy Commander of the ROK-U.S. Combined Forces Command, Kang Shin-cheol, has been nominated as the Minister of National Defense. His close involvement in alliance matters raises expectations about his ability to address pressing defense issues, including the transfer of wartime operational control and the integration of military academies.Kim Seung-won, a re-elected member of the Democratic Party, has been nominated as the new Minister of Justice. Chief of Staff Kang Hoon-sik stated, "He understands the intent behind the reform of the criminal and judicial system better than anyone, and we expect him to prioritize the protection of victims' rights while swiftly implementing new systems."Lee So-young, a member of the Democratic Party, has been nominated as the Minister of SMEs and Startups, while Yoon Hye-in from the Basic Income Party has been nominated as the Minister of Gender Equality and Family.Yoon's appointment is particularly notable as she was born in 1990, and if confirmed, she will become the first minister from the 1990s generation.The reshuffle of the presidential staff focused more on strengthening than on reform. Lee Hae-min from the Justice Party has been appointed as the Chief of AI Future Planning. This appointment, like Yoon's, highlights the inclusion of opposition figures from the ruling coalition.Former Governor of Gyeongnam Kim Kyung-soo has been appointed as the President's Special Political Advisor, marking a significant appointment of a prominent pro-Moon figure.Ha Jung-woo, former Chief of AI Future Planning, has been named Vice Chair of the National AI Strategy Committee, while Lee Won-joo, currently the Director of Energy Transition Policy at the Ministry of Climate, Energy and Environment, has been appointed as the Chief of the Mega Project Office, which will lead the government's "three mega projects."* This article has been translated by AI. 2026-08-30 17:36:00
  • Korean Tax Agency Shares Global Minimum Tax Experience with Thailand
    Korean Tax Agency Shares Global Minimum Tax Experience with Thailand The National Tax Service (NTS) has shared its tax administration experience with the Thai Revenue Department and addressed tax-related issues faced by local businesses, establishing a tax support hotline between the two countries.On August 27, the NTS visited Thailand to share its experiences in implementing global minimum tax legislation and reporting systems. The global minimum tax applies to multinational corporate groups with revenues exceeding €750 million, taxing the difference if the effective tax rate falls below the minimum rate of 15%.This visit was organized as Thailand prepares to implement the global minimum tax next year, seeking insights from South Korea, which received its first reports this year.Prior to the visit, the NTS gathered information on tax inquiries and issues faced by South Korean companies operating in Thailand through the Korea-Thailand Chamber of Commerce and the Korea Trade-Investment Promotion Agency (KOTRA).A local manufacturing company reported that it has not received a tax refund from the Thai Revenue Department since May 2023, despite submitting the necessary documents for a refund of withholding tax paid on processing fees received from clients.Another exporting company is experiencing delays in value-added tax refunds due to the Thai Revenue Department's processing being behind schedule, impacting its cash flow.The NTS conveyed these cases to the Thai authorities and requested their cooperation. Additionally, it encouraged Thailand to join the automatic information exchange agreement on global minimum tax to ease taxpayer burdens. A hotline for tax support between South Korea and Thailand will also be established to directly relay local business concerns to the Thai Revenue Department.The Thai Revenue Department has agreed to review the inquiries and issues raised and will cooperate to ensure smooth tax reporting and stable operations for South Korean companies in Thailand.* This article has been translated by AI. 2026-08-30 17:36:00
  • Profile of Kang Shin-cheol, Defense Minister Nominee and Four-Star General
    Profile of Kang Shin-cheol, Defense Minister Nominee and Four-Star General Kang Shin-cheol, the nominee for Defense Minister, is a four-star general who previously served as the deputy commander of the U.S.-South Korea Combined Forces Command.After graduating from the Army Academy (46th class), he held various key positions within the Ministry of National Defense, the Joint Chiefs of Staff, and the Combined Forces Command. He has been appointed to critical roles under both progressive and conservative administrations.Following his service as the policy director at the Combined Forces Command and the operations planning director at the Joint Chiefs of Staff, he served as a military advisor to then-Defense Minister Han Min-koo from 2016 to 2017 during the Park Geun-hye administration.He later held positions as the operations director of the Army's First Corps, the president of the Army Command College, and the commander of the 11th Mechanized Infantry Division, before becoming the director of strategic planning at the Joint Chiefs of Staff.During the Moon Jae-in administration, he worked as the defense reform secretary and the security and defense strategy secretary at the National Security Office from 2021 to 2022. His predecessor in the defense reform role is Kang Geon-jak, the current first deputy director of the National Security Office.After the inauguration of the Yoon Suk-yeol administration, he was appointed to the important position of operations director at the Joint Chiefs of Staff and was promoted to four-star general in 2023, subsequently becoming the deputy commander of the Combined Forces Command, the highest position for a South Korean general in the command. He was the only individual promoted to four-star general from the rank of lieutenant general during the Yoon administration, having been promoted to major general during the Moon administration.After serving as deputy commander of the Combined Forces Command until September 2025, he was appointed as the ambassador to Saudi Arabia in January of this year, focusing on strengthening defense cooperation and protecting South Korean citizens abroad.The Lee Jae-myung administration emphasized 'resolving insurrections' and defense reform when it appointed Minister Ahn Gyu-baek as its first Defense Minister in June of last year, following the 12-3 emergency martial law situation.There is keen interest in whether Kang can address pressing defense issues, such as the integration of military academies and the transfer of wartime operational control.His close involvement in alliance matters during his tenure as deputy commander of the Combined Forces Command has earned him high praise. The decision to appoint Kang, an Army Academy graduate, comes at a time when efforts are underway to integrate the Army, Navy, and Air Force academies.Kang Hoon-sik, the chief of staff at the Blue House, explained during a briefing, "He is currently the ambassador to Saudi Arabia and a four-star general who has held key positions, including operations director at the Joint Chiefs of Staff. We expect him to strengthen self-defense capabilities in preparation for future warfare based on a solid South Korea-U.S. alliance and to boldly and swiftly open new paths for defense innovation, including the integration of military academies."◇ Profile△ Born in 1968 △ Kyungsung High School △ Army Academy (46th class) △ Master's degree in military studies from Chungnam National University (Graduate School of Peace and Security) △ Military advisor to the Ministry of National Defense △ Operations director of the Army's First Corps △ President of the Army Command College △ Commander of the 11th Mechanized Infantry Division △ Director of strategic planning at the Joint Chiefs of Staff △ Defense reform secretary at the National Security Office △ Security and defense strategy secretary at the National Security Office △ Deputy commander of the Ground Operations Command △ Operations director at the Joint Chiefs of Staff △ Deputy commander of the U.S.-South Korea Combined Forces Command △ Ambassador to Saudi Arabia* This article has been translated by AI. 2026-08-30 17:32:10
  • Knowledge Industry Center Struggles Amid Rising Interest Rates and Loan Restrictions
    Knowledge Industry Center Struggles Amid Rising Interest Rates and Loan Restrictions Owners of knowledge industry centers are facing severe challenges as they grapple with declining asset values, reduced loan availability, rising interest rates, and increased principal repayment burdens.A resident who purchased a knowledge industry center in Gyeonggi Province, identified as A, expressed concerns in an interview on the 30th, stating, "The burden of principal repayment is growing due to rising interest rates and frequent re-evaluations during the loan extension process."A reported that the interest rate on their loan increased from the mid-4% range to 7.33% during this month's extension, with the loan now requiring renewal every three months. A had previously taken out a loan of 348 million won to purchase a knowledge industry center for 410 million won in 2023.Although the principal repayment amount was adjusted from 17 million won to about 10 million won during this extension, A is concerned about the future. "While I have tenants, the rental income is insufficient to cover the loan interest, forcing me to invest my own money. If I am continually required to repay the principal, it will be difficult to manage," A lamented.The situation is compounded by the difficulty of selling assets to alleviate the financial burden. The market for knowledge industry centers is flooded with unsold units being offered at discounted prices, making it challenging for existing owners to sell. Some units are being sold at approximately 18% less than their original prices. For instance, A's property, originally purchased for 410 million won, is now listed by the developer for about 320 million won.Leasing is also proving difficult. With increasing vacancies, landlords are lowering rents to attract tenants. An industry insider noted, "Some knowledge industry centers are reducing rents to between 200,000 and 300,000 won to secure tenants, and the relatively high management fees make it challenging to maintain occupancy rates."Financial institutions are tightening their assessments of commercial real estate, including knowledge industry centers. A bank representative stated, "Due to the poor market conditions for knowledge industry centers, banks have increased their scrutiny. In the past, loan-to-value ratios reached 80%, but now they can drop to 50% due to poor collateral evaluations." The representative added that the reduction in secured loans often leads to a shift toward unsecured loans.This has created a vicious cycle: declining prices lead to reduced collateral value, which results in lower loan limits, necessitating additional capital, and ultimately leading to auctions.According to Kang Eun-hyun, head of the Law Firm Myungdo Auction Research Institute, "Knowledge industry centers, once in high demand, have seen oversupply and decreased demand due to economic downturns, particularly in the metropolitan area. Many investors leveraged their purchases when lending restrictions were less stringent, but as financial pressures increase, more properties are moving toward auction."Once properties enter the auction process, recovering losses becomes difficult. Demand for commercial real estate is more limited than for residential properties, increasing the likelihood of repeated failures to sell. If properties are sold quickly, they may fetch prices below market value. A decline in the auction price can exacerbate losses for existing owners and further depress the market value and collateral of knowledge industry centers.Meanwhile, converting existing knowledge industry centers for different uses has emerged as a potential solution. The Korea Real Estate Development Industry Research Institute suggested in a policy report in March that converting unsold knowledge industry centers into residential facilities could be a viable alternative, emphasizing the need for agreements with the Korea Land and Housing Corporation, policy financing support, and the relaxation of financial and tax regulations.* This article has been translated by AI. 2026-08-30 17:32:10